2245 Rabbit Creek Rd

Buchanan, TN 38222

$175,000D

3 bd · 1.0 ba · 1,450 sqft · Built 1900 · SingleFamily · Active · 64 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,169/mo
• Mortgage (P&I): −$918
• Tax + insurance: −$104
• HOA: −$0
• Vac / Maint / Mgmt: −$245
• Net cashflow: $-98/mo
• Annual: $-1,177/yr
• Cap rate: 5.62%
• Cash-on-cash: -2.40%
• DSCR: 0.89
• 1% rule: 0.67%
• Cash to close: $49,000

Investor read

• This is a 3-bed/1.0-bath single-family listed at $175k.
• At list price, monthly cash flow is $-98 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $158k (9.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $117k (33.2% below list).
• It's been on market 64 days — a 6% lower offer ($164k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $117k (33.2% below list) — sets the bar for 1% rule.
• In year one you build about $19k of equity ($1k loan paydown + $18k appreciation (10.0% local appreciation)).
• Location reads: area grade D — affects rentability + tenant quality, not the cash-flow math above.
• Henry County (rural): math 30% / reading 30% proficiency, ranked #60 of 139 in TN (top 43%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Lakewood Elementary (math 38% / reading 30%, grade F, #351 of 952 statewide, top 37%, 505 students, 0% FRL); Lakewood Middle School (math 34% / reading 25%, grade F, #107 of 333 statewide, top 33%, 249 students, 0% FRL) — zoned schools average 0% FRL vs 55% district-wide (55 pts lower); this property's tenant base skews higher-income than the district average.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 46 active listings in the ZIP; 19 units permitted in Henry County in 2024 (0 in 5+ unit buildings).
• Henry County population projected to shrink 10% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 4 sale attempts since 3y ago; this cycle's ask has dropped $15k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $70k; list at $175k implies a 150% gain — meaningful room to come down on a strong offer.
• By year 2, paydown + projected appreciation supports a ~$30k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.6% vs local median 1.8% in Buchanan — 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

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 64 days. Have you received any prior offers? Is the seller open to a 33% concession, seller financing, or rate buy-down credit?
• Built in 1900 — 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.
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• 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.