1110 Hickory Flats Rd

Pennington Gap, VA 24277

$164,900C-

3 bd · 2.0 ba · 1,903 sqft · Built 1976 · SingleFamily · Active · 134 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,211/mo
• Mortgage (P&I): −$865
• Tax + insurance: −$155
• HOA: −$0
• Vac / Maint / Mgmt: −$254
• Net cashflow: $-63/mo
• Annual: $-755/yr
• Cap rate: 5.83%
• Cash-on-cash: -1.64%
• DSCR: 0.93
• 1% rule: 0.73%
• Cash to close: $46,172

Investor read

• This is a 3-bed/2.0-bath single-family listed at $165k.
• At list price, monthly cash flow is $-63 ($-755/yr) — negative.
• To cash-flow at today's rent, offer at most $154k (6.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $121k (26.6% below list).
• It's been on market 134 days — a 12% lower offer ($145k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $121k (26.6% below list) — sets the bar for 1% rule.
• In year one you build about $10k of equity ($1k loan paydown + $9k appreciation (5.6% local appreciation)).
• Location reads 62/100 on livability (#410 in VA) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing B; Watch: amenities F, commute F, employment F.
• Lee County Public School District (rural): math 53% / reading 69% proficiency, ranked #62 of 131 in VA (top 47%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: 30 active listings in the ZIP; 18 units permitted in Lee County in 2024 (0 in 5+ unit buildings).
• Lee County population projected at -27% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $63k; list at $165k implies a 162% gain — meaningful room to come down on a strong offer.
• At projected returns (5.6% appreciation + 3.0% rent growth), your $46k cash investment doubles in ~5 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$35k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major wildfire risk — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 134 days. Have you received any prior offers? Is the seller open to a 27% concession, seller financing, or rate buy-down credit?
• Built in 1976 — 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.
• 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.