1404 Skyline Dr

Johnson City, TN 37604

$225,000C-

3 bd · 1.0 ba · 2,092 sqft · Built 1935 · SingleFamily · Pending · 4 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,850/mo
• Mortgage (P&I): −$1,180
• Tax + insurance: −$184
• HOA: −$0
• Vac / Maint / Mgmt: −$389
• Net cashflow: $97/mo
• Annual: $1,168/yr
• Cap rate: 6.81%
• Cash-on-cash: 1.85%
• DSCR: 1.08
• 1% rule: 0.82%
• Cash to close: $63,000

Investor read

• This is a 3-bed/1.0-bath single-family listed at $225k.
• At list price, monthly cash flow is $97 ($1k/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 $185k (17.8% below list).
• Only 4 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $185k (17.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#8 in TN, #3,349 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, cost of living A+, health & safety A; Watch: crime D, commute F, employment F.
• Johnson City (urban): math 46% / reading 47% proficiency, ranked #9 of 139 in TN (top 6%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Woodland Elementary (math 52% / reading 62%, grade C+, #75 of 952 statewide, top 8%, 522 students, 0% FRL); Liberty Bell Middle School (math 43% / reading 38%, grade F, #42 of 333 statewide, top 13%, 898 students, 0% FRL); Science Hill High School (math 37% / reading 60%, grade D, #13 of 332 statewide, top 4%, 2,401 students, 0% FRL) — zoned schools average 0% FRL vs 44% district-wide (44 pts lower); this property's tenant base skews higher-income than the district average.
• Watch-outs: built in 1935 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.5%/yr); 208 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 75% of comp listings sitting > 30 days — soft ceiling on asking rent; 1,155 units permitted in Washington County in 2024 (437 in 5+ unit buildings).
• Washington County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Current owner paid $136k; list at $225k implies a 66% gain — meaningful room to come down on a strong offer.
• Cap rate 6.8% vs local median 3.1% in Johnson City — 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 42% of the median local income ($52k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1935 — 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.
• Crime grade is D 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.