400 E Ferguson St

Tyler, TX 75702

$730,000B-

100 bd · 100.0 ba · 10,000 sqft · Built 1930 · MultiFamily · Active · 206 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $17,091/mo
• Mortgage (P&I): −$3,828
• Tax + insurance: −$1,217
• HOA: −$0
• Vac / Maint / Mgmt: −$3,589
• Net cashflow: $8,457/mo
• Annual: $101,484/yr
• Cap rate: 20.19%
• Cash-on-cash: 49.65%
• DSCR: 3.21
• 1% rule: 2.34%
• Cash to close: $204,400

Investor read

• This is a 10 × 10-bed/?-bath units multifamily listed at $730k. Condition is rated fair.
• At list price, monthly cash flow is $8k ($101k/yr) — positive. Per door: $846/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($17k rent vs $730k).
• It's been on market 206 days — a 12% lower offer ($642k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $642k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $5k of loan paydown is wiped out by about $22k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#147 in TX, #4,181 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment C-, schools D+, crime D+.
• Tyler ISD (urban): math 39% / reading 38% proficiency, ranked #449 of 826 in TX (top 54%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 66% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1930 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.3%/yr); 155 active listings in the ZIP; 595 units permitted in Smith County in 2024 (45 in 5+ unit buildings).
• Smith County population projected at +24% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts; this cycle's ask has dropped $80k (10%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 2.3% rent growth), your $204k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 59% chance of damaging wind over 30y; extreme-heat days projected 7→27/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 20.2% vs local median 3.6% in Tyler — 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.
• At $17,091/mo this rent would consume 398% of the median local household income ($52k/yr) (locally 803% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 206 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1930 — 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 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?

Repairs flagged (vision-AI assessment)

• Major: exterior siding — Significant wear and tear
• Major: flooring — Worn-out carpet
• Major: interior walls — Peeling paint
• Major: landscaping — Overgrown yard