604 S Prospect St

Amarillo, TX 79106

$150,000F

2 bd · 2.0 ba · 1,138 sqft · Built 1925 · Other · Active · 40 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $996/mo
• Mortgage (P&I): −$787
• Tax + insurance: −$180
• HOA: −$0
• Vac / Maint / Mgmt: −$209
• Net cashflow: $-181/mo
• Annual: $-2,167/yr
• Cap rate: 4.85%
• Cash-on-cash: -5.16%
• DSCR: 0.77
• 1% rule: 0.66%
• Cash to close: $42,000

Investor read

• This is a 2-bed/2.0-bath other listed at $150k.
• At list price, monthly cash flow is $-181 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $118k (21.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $100k (33.6% below list).
• It's been on market 40 days — a 3% lower offer ($146k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $100k (33.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#624 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: amenities C-, schools D, crime F.
• Amarillo ISD (urban): math 44% / reading 41% proficiency, ranked #336 of 826 in TX (top 41%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1925 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+4.7%/yr); 132 active listings in the ZIP; 21 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); 1,214 units permitted in Potter County in 2024 (650 in 5+ unit buildings).
• 2 sale attempts since 3y ago 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 wildfire risk — expect insurance premiums to compound above CPI over the hold.

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 40 days. Have you received any prior offers? Is the seller open to a 34% concession, seller financing, or rate buy-down credit?
• Built in 1925 — 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 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?
• 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?
• 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.