717 Hershberger Rd NW

Roanoke, VA 24012

$139,500C-

2 bd · 1.0 ba · 768 sqft · Built 1950 · SingleFamily · Pending · 522 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,165/mo
• Mortgage (P&I): −$732
• Tax + insurance: −$181
• HOA: −$0
• Vac / Maint / Mgmt: −$245
• Net cashflow: $8/mo
• Annual: $96/yr
• Cap rate: 6.36%
• Cash-on-cash: 0.25%
• DSCR: 1.01
• 1% rule: 0.84%
• Cash to close: $39,060

Investor read

• This is a 2-bed/1.0-bath single-family listed at $140k.
• At list price, monthly cash flow is $8 ($96/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 $116k (16.5% below list).
• It's been on market 522 days — a 12% lower offer ($123k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $116k (16.5% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $964 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#163 in VA) — a middle-class / working-renter tenant base. Strengths: cost of living A+, health & safety A+, housing A; Watch: amenities C-, employment D, crime F.
• Roanoke City Public School District (urban): math 40% / reading 58% proficiency, ranked #102 of 131 in VA (top 78%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Preston Park Elementary (math 33% / reading 51%, grade F, #866 of 1,108 statewide, top 80%, 505 students, 102% FRL); Breckinridge Middle (math 23% / reading 52%, grade F, #315 of 342 statewide, top 93%, 624 students, 99% FRL); William Fleming High (math 66% / reading 68%, grade B, #185 of 319 statewide, top 61%, 1,911 students, 96% FRL) — zoned schools average 99% FRL vs 67% district-wide (32 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+10.5%/yr); 196 active listings in the ZIP; 14 comparable units currently listed for rent nearby; rentals at typical pace (median 15d on market — plan ~3-4 weeks tenant-placement turnaround); 113 units permitted in Roanoke city in 2024 (0 in 5+ unit buildings).
• Roanoke County population projected at +11% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 12 sale attempts since 22y ago; this cycle's ask has dropped $60k (30%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $77k; list at $140k implies a 81% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.4% vs local median 4.2% in Roanoke — 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 522 days. Have you received any prior offers? Is the seller open to a 16% concession, seller financing, or rate buy-down credit?
• Built in 1950 — 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 A-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.