1642 Pebblestone Ct

Morristown, TN 37814

$342,871D

4 bd · 3.0 ba · 2,072 sqft · Built 2022 · SingleFamily · Active · 159 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,791/mo
• Mortgage (P&I): −$1,798
• Tax + insurance: −$286
• HOA: −$29
• Vac / Maint / Mgmt: −$586
• Net cashflow: $92/mo
• Annual: $1,101/yr
• Cap rate: 6.61%
• Cash-on-cash: 1.15%
• DSCR: 1.05
• 1% rule: 0.81%
• Cash to close: $96,004

Investor read

• This is a 4-bed/3.0-bath single-family listed at $343k. Condition is rated good.
• At list price, monthly cash flow is $92 ($1k/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 $279k (18.6% below list).
• It's been on market 159 days — a 12% lower offer ($302k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $279k (18.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#175 in TN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, health & safety A+, housing A-; Watch: crime F, amenities F, commute F.
• Hamblen County (urban): math 31% / reading 30% proficiency, ranked #57 of 139 in TN (top 41%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Fairview Marguerite (math 28% / reading 23%, grade F, #536 of 952 statewide, top 57%, 490 students, 0% FRL); Meadowview Middle School (math 28% / reading 16%, grade F, #176 of 333 statewide, top 55%, 627 students, 0% FRL); Morristown East High (math 12% / reading 37%, grade F, #129 of 332 statewide, top 43%, 1,572 students, 0% FRL) — zoned schools average 0% FRL vs 54% district-wide (54 pts lower); this property's tenant base skews higher-income than the district average.
• Market conditions: 333 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 298 units permitted in Hamblen County in 2024 (48 in 5+ unit buildings).
• 3 sale attempts since 5y 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.
• Current owner paid $280k; 22% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.6% vs local median 2.9% in Morristown — 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 $2,791/mo this rent would consume 60% of the median local household income ($56k/yr) (locally 1001% 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 159 days. Have you received any prior offers? Is the seller open to a 19% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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.