506 N Washington St

Kaufman, TX 75142

$120,000B-

4 bd · 2.0 ba · 2,610 sqft · Built 1955 · SingleFamily · Pending · 112 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,650/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$200
• HOA: −$0
• Vac / Maint / Mgmt: −$556
• Net cashflow: $1,264/mo
• Annual: $15,170/yr
• Cap rate: 18.93%
• Cash-on-cash: 45.15%
• DSCR: 3.01
• 1% rule: 2.21%
• Cash to close: $33,600

Investor read

• This is a 4-bed/2.0-bath single-family listed at $120k.
• At list price, monthly cash flow is $1k ($15k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $120k).
• It's been on market 112 days — a 9% lower offer ($109k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $109k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $830 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#478 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A-; Watch: schools D+, amenities F, commute F.
• Kaufman ISD (town): math 38% / reading 39% proficiency, ranked #437 of 826 in TX (top 53%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1955 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 278 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 1,747 units permitted in Kaufman County in 2024 (180 in 5+ unit buildings).
• Kaufman County population projected at +43% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 8 sale attempts since 8y ago; this cycle's ask has dropped $40k (25%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $34k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; major wildfire risk; extreme-heat days projected 7→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 18.9% vs local median 4.1% in Kaufman — 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 112 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1955 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-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.