201 Mallory St

Lindale, TX 75771

$135,000D-

3 bd · 1.0 ba · 980 sqft · Built 1950 · SingleFamily · Active · 33 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,187/mo
• Mortgage (P&I): −$708
• Tax + insurance: −$227
• HOA: −$0
• Vac / Maint / Mgmt: −$249
• Net cashflow: $2/mo
• Annual: $27/yr
• Cap rate: 6.31%
• Cash-on-cash: 0.07%
• DSCR: 1.00
• 1% rule: 0.88%
• Cash to close: $37,800

Investor read

• This is a 3-bed/1.0-bath single-family listed at $135k.
• At list price, monthly cash flow is $2 ($27/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $119k (12.1% below list).
• It's been on market 33 days — a 3% lower offer ($131k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $119k (12.1% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $933 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 79/100 on livability (#52 in TX, #2,100 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, cost of living A+, housing A+; Watch: amenities F, commute F.
• Lindale ISD (town): math 71% / reading 66% proficiency, ranked #20 of 826 in TX (top 2%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Velma Penny El (math 67% / reading 67%, grade B+, #199 of 4,322 statewide, top 5%, 541 students, 48% FRL); Lindale J H (math 81% / reading 72%, grade A, #30 of 1,662 statewide, top 2%, 711 students, 44% FRL); Lindale H S (math 79% / reading 75%, grade A-, #60 of 1,632 statewide, top 4%, 1,265 students, 38% FRL).
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 640 active listings in the ZIP; 12 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 595 units permitted in Smith County in 2024 (45 in 5+ unit buildings).
• Smith County population projected at +24% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 5 sale attempts since 5y ago; this cycle's ask has dropped $10k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: major wind risk, 52% chance of damaging wind over 30y; extreme-heat days projected 7→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.3% vs local median 3.1% in Lindale — 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.
• This rent is only 15% of the median local income ($93k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

Questions for listing agent

• It's been on market 33 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1950 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• 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.