705 Elk Rdg

Covington, LA 70435

$387,441D

4 bd · 2.0 ba · 1,901 sqft · Built 2026 · SingleFamily · Pending · 25 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,264/mo
• Mortgage (P&I): −$2,032
• Tax + insurance: −$646
• HOA: −$83
• Vac / Maint / Mgmt: −$685
• Net cashflow: $-182/mo
• Annual: $-2,187/yr
• Cap rate: 5.73%
• Cash-on-cash: -2.02%
• DSCR: 0.91
• 1% rule: 0.84%
• Cash to close: $108,483

Investor read

• This is a 4-bed/2.0-bath single-family listed at $387k. Condition is rated excellent.
• At list price, monthly cash flow is $-182 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $361k (6.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $326k (15.8% below list).
• It's been on market 25 days — a 2% lower offer ($382k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $326k (15.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#17 in LA, #3,876 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, health & safety A+; Watch: amenities F, commute F.
• St. Tammany Parish (suburban): math 43% / reading 55% proficiency, ranked #11 of 98 in LA (top 11%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 365 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 1,064 units permitted in St. Tammany Parish in 2024 (0 in 5+ unit buildings).
• St. Tammany County population projected at +27% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; major wildfire risk; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.7% vs local median 3.9% in Covington — 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.
• At $3,264/mo this rent would consume 48% of the median local household income ($81k/yr) (locally 296% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.