7885 N Fm 607

Murchison, TX 75778

$70,000B+

2 bd · 1.0 ba · 1,025 sqft · Built 1966 · SingleFamily · Active · 195 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,204/mo
• Mortgage (P&I): −$367
• Tax + insurance: −$133
• HOA: −$0
• Vac / Maint / Mgmt: −$253
• Net cashflow: $451/mo
• Annual: $5,415/yr
• Cap rate: 14.03%
• Cash-on-cash: 27.63%
• DSCR: 2.23
• 1% rule: 1.72%
• Cash to close: $19,600

Investor read

• This is a 2-bed/1.0-bath single-family listed at $70k.
• At list price, monthly cash flow is $451 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $70k).
• It's been on market 195 days — a 12% lower offer ($62k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $62k (12.0% below list) — sets the bar for market timing.
• In year one you build about $4k of equity ($484 loan paydown + $3k appreciation (4.6% local appreciation)).
• Location reads 56/100 on livability (#1,285 in TX) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing B+; Watch: employment D, schools D-, crime F.
• Brownsboro ISD (rural): math 42% / reading 46% proficiency, ranked #290 of 826 in TX (top 35%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 110 active listings in the ZIP; 263 units permitted in Henderson County in 2024 (0 in 5+ unit buildings).
• 2 sale attempts; this cycle's ask has dropped $10k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (4.6% appreciation + 3.0% rent growth), your $20k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 9, paydown + projected appreciation supports a ~$32k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major wind risk, 63% chance of damaging wind over 30y; extreme-heat days projected 7→26/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 195 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1966 — 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.