493 Salem Rd

Gadsden, TN 38337

$54,900B+

3 bd · 1.0 ba · 1,812 sqft · Built 1951 · SingleFamily · Pending · 63 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,287/mo
• Mortgage (P&I): −$288
• Tax + insurance: −$68
• HOA: −$0
• Vac / Maint / Mgmt: −$270
• Net cashflow: $662/mo
• Annual: $7,939/yr
• Cap rate: 20.75%
• Cash-on-cash: 51.65%
• DSCR: 3.30
• 1% rule: 2.34%
• Cash to close: $15,372

Investor read

• This is a 3-bed/1.0-bath single-family listed at $55k.
• At list price, monthly cash flow is $662 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $55k).
• It's been on market 63 days — a 6% lower offer ($52k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $52k (6.0% below list) — sets the bar for market timing.
• In year one you build about $3k of equity ($380 loan paydown + $3k appreciation (4.7% local appreciation)).
• Location reads 58/100 on livability (#311 in TN) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A+; Watch: health & safety C-, employment D+, schools F.
• Alamo (town): math 54% / reading 46% proficiency, ranked #8 of 139 in TN (top 6%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: built in 1951 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 15 active listings in the ZIP; 26 units permitted in Crockett County in 2024 (0 in 5+ unit buildings).
• At projected returns (4.7% appreciation + 3.0% rent growth), your $15k cash investment doubles in ~2 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 63 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Built in 1951 — 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 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?
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.