404 N Hill St

Itasca, TX 76055

$114,999A

2 bd · 1.0 ba · 1,040 sqft · Built 1920 · SingleFamily · Active · 96 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,546/mo
• Mortgage (P&I): −$603
• Tax + insurance: −$192
• HOA: −$0
• Vac / Maint / Mgmt: −$325
• Net cashflow: $426/mo
• Annual: $5,115/yr
• Cap rate: 10.74%
• Cash-on-cash: 15.89%
• DSCR: 1.71
• 1% rule: 1.34%
• Cash to close: $32,200

Investor read

• This is a 2-bed/1.0-bath single-family listed at $115k. Condition is rated good.
• At list price, monthly cash flow is $426 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $115k).
• It's been on market 96 days — a 9% lower offer ($105k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $105k (9.0% below list) — sets the bar for market timing.
• In year one you build about $12k of equity ($795 loan paydown + $12k appreciation (10.0% local appreciation)).
• Location reads 63/100 on livability (#832 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A-; Watch: employment D, amenities F, commute F.
• Itasca ISD (rural): math 23% / reading 35% proficiency, ranked #636 of 826 in TX (top 77%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 63% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Itasca El (math 17% / reading 32%, grade F, #3,052 of 4,322 statewide, top 74%, 295 students, 74% FRL); Itasca Middle (math 32% / reading 32%, grade F, #971 of 1,662 statewide, top 60%, 164 students, 62% FRL); Itasca H S (math 15% / reading 44%, grade F, #1,106 of 1,632 statewide, top 68%, 192 students, 59% FRL) — zoned schools at 65% FRL track the district average.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 112 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals lingering (median 140d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 83% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 65 units permitted in Hill County in 2024 (0 in 5+ unit buildings).
• Hill County population projected at -12% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts; this cycle's ask has dropped $25k (18%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $32k cash investment doubles in ~2 years — after that, you're playing with house money.
• By year 3, paydown + projected appreciation supports a ~$31k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.7% vs local median 5.7% in Itasca — 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 96 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1920 — 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?
• 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.