1007 2nd Ave SE

Mineral Wells, TX 76067

$39,999B-

1 bd · None ba · 1,416 sqft · Built 1960 · SingleFamily · Active · 16 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,145/mo
• Mortgage (P&I): −$210
• Tax + insurance: −$554
• HOA: −$0
• Vac / Maint / Mgmt: −$240
• Net cashflow: $140/mo
• Annual: $1,684/yr
• Cap rate: 23.30%
• Cash-on-cash: 60.74%
• DSCR: 3.70
• 1% rule: 2.86%
• Cash to close: $11,200

Investor read

• This is a 1-bed/?-bath single-family listed at $40k.
• At list price, monthly cash flow is $140 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $40k).
• It's been on market 16 days — a 2% lower offer ($39k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $39k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $276 of loan paydown is wiped out by about $1k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#278 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: crime D+, employment D, amenities F.
• Mineral Wells ISD (town): math 30% / reading 30% proficiency, ranked #636 of 826 in TX (top 77%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Mineral Wells El (math 36% / reading 28%, grade F, #2,268 of 4,322 statewide, top 55%, 1,915 students, 79% FRL); Mineral Wells J H (math 26% / reading 31%, grade F, #1,122 of 1,662 statewide, top 69%, 498 students, 75% FRL); Mineral Wells H S (math 15% / reading 33%, grade F, #1,333 of 1,632 statewide, top 82%, 920 students, 74% FRL) — zoned schools average 76% FRL vs 58% district-wide (18 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: property tax is 3.3% of price; flood insurance adds $427/mo.
• Market conditions: 279 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 27 units permitted in Palo Pinto County in 2024 (0 in 5+ unit buildings).
• Palo Pinto County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts 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.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $11k cash investment doubles in ~8 years — after that, you're playing with house money.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); major wildfire risk; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 23.3% vs local median 2.8% in Mineral Wells — 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

• Built in 1960 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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 D 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?
• 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.