1005 Railroad Ave

Franklin, VA 23851

$94,500B-

4 bd · 1.0 ba · 1,286 sqft · Built 1958 · SingleFamily · Active Under Contract · 15 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,585/mo
• Mortgage (P&I): −$496
• Tax + insurance: −$112
• HOA: −$0
• Vac / Maint / Mgmt: −$333
• Net cashflow: $644/mo
• Annual: $7,730/yr
• Cap rate: 14.47%
• Cash-on-cash: 29.21%
• DSCR: 2.30
• 1% rule: 1.68%
• Cash to close: $26,460

Investor read

• This is a 4-bed/1.0-bath single-family listed at $94k.
• At list price, monthly cash flow is $644 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $94k).
• It's been on market 15 days — a 2% lower offer ($93k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $93k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $653 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 59/100 on livability (#461 in VA) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A+, health & safety B+; Watch: crime F, amenities F, commute F.
• Franklin City Public School District (town): math 23% / reading 51% proficiency, ranked #127 of 131 in VA (top 97%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 75% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: S.P. Morton Elementary (math 16% / reading 38%, grade F, #1,029 of 1,108 statewide, top 94%, 481 students, 101% FRL); Franklin High (math 37% / reading 82%, grade C+, #247 of 319 statewide, top 80%, 378 students, 100% FRL) — zoned schools average 101% FRL vs 75% district-wide (26 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1958 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 137 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 67% of comp listings sitting > 30 days — soft ceiling on asking rent.
• Franklin County population projected at -22% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $65k; 45% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $26k cash investment doubles in ~5 years — after that, you're playing with house money.
• Cap rate 14.5% vs local median 3.7% in Franklin — 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 1958 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.