405 W James Ave

Mertzon, TX 76941

$65,000B+

2 bd · 4.0 ba · 1,498 sqft · Built 1985 · SingleFamily · Pending · 39 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,218/mo
• Mortgage (P&I): −$341
• Tax + insurance: −$148
• HOA: −$0
• Vac / Maint / Mgmt: −$256
• Net cashflow: $473/mo
• Annual: $5,681/yr
• Cap rate: 15.03%
• Cash-on-cash: 31.21%
• DSCR: 2.39
• 1% rule: 1.87%
• Cash to close: $18,200

Investor read

• This is a 2-bed/4.0-bath single-family listed at $65k.
• At list price, monthly cash flow is $473 ($6k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $65k).
• It's been on market 39 days — a 3% lower offer ($63k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $63k (3.0% below list) — sets the bar for market timing.
• In year one you build about $1k of equity ($449 loan paydown + $941 appreciation (1.4% local appreciation)).
• Location reads 67/100 on livability (#540 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: employment C-, health & safety C-, crime F.
• Irion County ISD (rural): math 50% / reading 55% proficiency, ranked #272 of 1,141 in TX (top 24%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: 20 active listings in the ZIP.
• Irion County population projected at -12% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 3 sale attempts; this cycle's ask has dropped $35k (35%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (1.4% appreciation + 3.0% rent growth), your $18k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: 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.

Questions for listing agent

• It's been on market 39 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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?
• 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.