4140 Tesson St

St. Louis, MO 63123

$175,000D

3 bd · 1.0 ba · 960 sqft · Built 1950 · SingleFamily · Active · 356 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,546/mo
• Mortgage (P&I): −$918
• Tax + insurance: −$356
• HOA: −$0
• Vac / Maint / Mgmt: −$325
• Net cashflow: $-52/mo
• Annual: $-629/yr
• Cap rate: 6.39%
• Cash-on-cash: 0.34%
• DSCR: 1.02
• 1% rule: 0.88%
• Cash to close: $49,000

Investor read

• This is a 3-bed/1.0-bath single-family listed at $175k.
• At list price, monthly cash flow is $-52 ($-629/yr) — negative.
• To cash-flow at today's rent, offer at most $166k (5.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $155k (11.7% below list).
• It's been on market 356 days — a 12% lower offer ($154k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $154k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads: area grade D — affects rentability + tenant quality, not the cash-flow math above.
• St. Louis City (urban): math 10% / reading 18% proficiency, ranked #312 of 324 in MO (top 96%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 80% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Woerner Elem. (math 8% / reading 17%, grade F, #1,007 of 1,115 statewide, top 91%, 362 students, 99% FRL); Gateway Middle (math 0% / reading 8%, grade F, #389 of 391 statewide, top 100%, 506 students, 99% FRL); Roosevelt High (math 2% / reading 8%, grade F, #517 of 521 statewide, top 100%, 460 students, 99% FRL) — zoned schools average 99% FRL vs 80% district-wide (19 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: flood insurance adds $66/mo; built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+3.0%/yr); 191 active listings in the ZIP; 37 comparable units currently listed for rent nearby; rentals at typical pace (median 16d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 294 units permitted in St. Louis city in 2024 (227 in 5+ unit buildings).
• St. Louis County population projected to shrink 6% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts since 3y ago; this cycle's ask is 9111% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Climate carrying-cost: severe flood 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 6.4% vs local median 5.0% in St. Louis — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

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 356 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?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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.
• 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.