1701 E Leon St

Gatesville, TX 76528

$62,000B-

3 bd · 1.0 ba · 1,845 sqft · Built 1960 · SingleFamily · Active · 58 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,559/mo
• Mortgage (P&I): −$325
• Tax + insurance: −$209
• HOA: −$0
• Vac / Maint / Mgmt: −$327
• Net cashflow: $698/mo
• Annual: $8,374/yr
• Cap rate: 19.80%
• Cash-on-cash: 48.24%
• DSCR: 3.15
• 1% rule: 2.51%
• Cash to close: $17,360

Investor read

• This is a 3-bed/1.0-bath single-family listed at $62k.
• At list price, monthly cash flow is $698 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $62k).
• It's been on market 58 days — a 3% lower offer ($60k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $60k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $429 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#702 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A; Watch: employment C-, schools F, amenities F.
• Gatesville ISD (town): math 38% / reading 42% proficiency, ranked #409 of 826 in TX (top 50%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: property tax is 3.5% of price.
• Market conditions: 222 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 386 units permitted in Coryell County in 2024 (0 in 5+ unit buildings).
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $17k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 46% chance of damaging wind over 30y; major wildfire risk; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 19.8% vs local median 3.9% in Gatesville — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.

Questions for listing agent

• It's been on market 58 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1960 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.