2811 Locust St

Kerrville, TX 78028

$120,000B

3 bd · 1.0 ba · 1,024 sqft · Built 1940 · SingleFamily · Active · 118 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,751/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$135
• HOA: −$0
• Vac / Maint / Mgmt: −$368
• Net cashflow: $619/mo
• Annual: $7,424/yr
• Cap rate: 12.48%
• Cash-on-cash: 22.09%
• DSCR: 1.98
• 1% rule: 1.46%
• Cash to close: $33,600

Investor read

• This is a 3-bed/1.0-bath single-family listed at $120k. Condition is rated poor.
• At list price, monthly cash flow is $619 ($7k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $120k).
• It's been on market 118 days — a 9% lower offer ($109k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $109k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $830 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#25 in TX, #1,483 nationally) — a professional / high-income tenant draw. Strengths: crime A+, cost of living A+, housing A+; Watch: employment C-, commute F.
• Kerrville ISD (town): math 45% / reading 51% proficiency, ranked #220 of 826 in TX (top 27%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Daniels El (math 56% / reading 50%, grade C, #705 of 4,322 statewide, top 17%, 548 students, 66% FRL); Peterson Middle (math 39% / reading 50%, grade D, #491 of 1,662 statewide, top 31%, 1,075 students, 52% FRL); Tivy H S (math 42% / reading 60%, grade D+, #482 of 1,632 statewide, top 30%, 1,468 students, 47% FRL).
• Watch-outs: built in 1940 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+3.0%/yr); 998 active listings in the ZIP; 12 comparable units currently listed for rent nearby; rentals leasing fast (median 6d on market — plan ~1-2 weeks tenant-placement turnaround); 422 units permitted in Kerr County in 2024 (322 in 5+ unit buildings).
• Kerr County population projected at +15% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $34k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 48% chance of damaging wind over 30y; moderate wildfire risk; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 12.5% vs local median 2.5% in Kerrville — 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.
• This rent runs 31% of the median local income ($67k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 118 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1940 — 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 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?
• 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.

Repairs flagged (vision-AI assessment)

• Major: roof — Rusty metal roof with visible damage
• Major: exterior walls — Exterior walls appear to be made of adobe or similar material, with visible cracks and discoloration
• Major: flooring — Flooring appears to be concrete or similar material, with visible cracks and unevenness
• Major: interior walls/paint — Interior walls show signs of wear and tear, with peeling paint and discoloration
• Major: HVAC unit — Old and in need of maintenance