602 Cedar St

Lott, TX 76656

$155,000D

3 bd · 2.0 ba · 1,584 sqft · Built 1915 · SingleFamily · Active · 160 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,311/mo
• Mortgage (P&I): −$813
• Tax + insurance: −$194
• HOA: −$0
• Vac / Maint / Mgmt: −$275
• Net cashflow: $28/mo
• Annual: $340/yr
• Cap rate: 6.51%
• Cash-on-cash: 0.78%
• DSCR: 1.03
• 1% rule: 0.85%
• Cash to close: $43,400

Investor read

• This is a 3-bed/2.0-bath single-family listed at $155k.
• At list price, monthly cash flow is $28 ($340/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $131k (15.4% below list).
• It's been on market 160 days — a 12% lower offer ($136k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $131k (15.4% below list) — sets the bar for 1% rule.
• In year one you build about $4k of equity ($1k loan paydown + $3k appreciation (2.2% local appreciation)).
• Location reads 50/100 on livability (#1,493 in TX) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+; Watch: housing D+, schools F, crime F.
• Rosebud-Lott ISD (rural): math 29% / reading 35% proficiency, ranked #592 of 826 in TX (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 61% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1915 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 26 active listings in the ZIP; 4 units permitted in Falls County in 2024 (0 in 5+ unit buildings).
• Falls County population projected at -14% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 9y ago; this cycle's ask has dropped $15k (9%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (2.2% appreciation + 3.0% rent growth), your $43k cash investment doubles in ~7 years — after that, you're playing with house money.
• By year 8, paydown + projected appreciation supports a ~$34k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 6→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 160 days. Have you received any prior offers? Is the seller open to a 15% concession, seller financing, or rate buy-down credit?
• Built in 1915 — 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 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?
• 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.