1232 S Montgomery St

Gilmer, TX 75644

$140,000C

3 bd · 1.0 ba · 868 sqft · Built — · SingleFamily · Active · 34 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,184/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$142
• HOA: −$0
• Vac / Maint / Mgmt: −$249
• Net cashflow: $60/mo
• Annual: $715/yr
• Cap rate: 6.80%
• Cash-on-cash: 1.82%
• DSCR: 1.08
• 1% rule: 0.85%
• Cash to close: $39,200

Investor read

• This is a 3-bed/1.0-bath single-family listed at $140k.
• At list price, monthly cash flow is $60 ($715/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 $118k (15.4% below list).
• It's been on market 34 days — a 3% lower offer ($136k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $118k (15.4% below list) — sets the bar for 1% rule.
• In year one you build about $15k of equity ($968 loan paydown + $14k appreciation (10.0% local appreciation)).
• Location reads 57/100 on livability (#1,257 in TX) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A+; Watch: amenities F, commute F, employment F.
• Gilmer ISD (town): math 44% / reading 38% proficiency, ranked #372 of 826 in TX (top 45%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Gilmer El (math 34% / reading 34%, grade F, #2,149 of 4,322 statewide, top 50%, 1,179 students, 81% FRL); Bruce J H (math 44% / reading 40%, grade D-, #572 of 1,662 statewide, top 36%, 429 students, 78% FRL); Gilmer H S (math 63% / reading 53%, grade C, #320 of 1,632 statewide, top 20%, 815 students, 73% FRL) — zoned schools average 77% FRL vs 54% district-wide (23 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 207 active listings in the ZIP; 34 units permitted in Upshur County in 2024 (0 in 5+ unit buildings).
• Upshur County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $39k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 3, paydown + projected appreciation supports a ~$38k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major wind risk, 48% chance of damaging wind over 30y; major wildfire risk; extreme-heat days projected 7→25/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.8% vs local median 2.8% in Gilmer — 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 34 days. Have you received any prior offers? Is the seller open to a 15% concession, seller financing, or rate buy-down credit?
• 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.