299 Houston St

Dunlap, TN 37327

$139,000C-

3 bd · 1.0 ba · 852 sqft · Built 1945 · SingleFamily · Pending · 50 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,050/mo
• Mortgage (P&I): −$729
• Tax + insurance: −$126
• HOA: −$0
• Vac / Maint / Mgmt: −$220
• Net cashflow: $-26/mo
• Annual: $-306/yr
• Cap rate: 6.07%
• Cash-on-cash: -0.79%
• DSCR: 0.96
• 1% rule: 0.76%
• Cash to close: $38,920

Investor read

• This is a 3-bed/1.0-bath single-family listed at $139k.
• At list price, monthly cash flow is $-26 ($-306/yr) — negative.
• To cash-flow at today's rent, offer at most $134k (3.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $105k (24.5% below list).
• It's been on market 50 days — a 3% lower offer ($135k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $105k (24.5% below list) — sets the bar for 1% rule.
• In year one you build about $15k of equity ($961 loan paydown + $14k appreciation (10.0% local appreciation)).
• Location reads 60/100 on livability (#264 in TN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, crime A-, housing B; Watch: amenities F, commute F, employment D-.
• Sequatchie County (rural): math 24% / reading 24% proficiency, ranked #95 of 139 in TN (top 68%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Griffith Elementary (math 38% / reading 30%, grade F, #351 of 952 statewide, top 37%, 778 students, 0% FRL); Sequatchie Co High School (math 17% / reading 32%, grade F, #129 of 332 statewide, top 43%, 631 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 1945 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 318 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 37 units permitted in Sequatchie County in 2024 (0 in 5+ unit buildings).
• Sequatchie County population projected at +8% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 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.
• 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: moderate 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 6.1% vs local median 2.4% in Dunlap — 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 50 days. Have you received any prior offers? Is the seller open to a 24% concession, seller financing, or rate buy-down credit?
• Built in 1945 — 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.
• 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?
• 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.