201 E Mclean St

Manchester, TN 37355

$319,000B-

16 bd · 5.0 ba · 2,436 sqft · Built 1905 · MultiFamily · Active · 29 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,629/mo
• Mortgage (P&I): −$1,673
• Tax + insurance: −$275
• HOA: −$0
• Vac / Maint / Mgmt: −$1,392
• Net cashflow: $3,289/mo
• Annual: $39,467/yr
• Cap rate: 18.67%
• Cash-on-cash: 44.19%
• DSCR: 2.97
• 1% rule: 2.08%
• Cash to close: $89,320

Investor read

• This is a 4 × 4-bed/2.0-bath units multifamily listed at $319k.
• At list price, monthly cash flow is $3k ($39k/yr) — positive. Per door: $822/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $319k).
• It's been on market 29 days — a 2% lower offer ($314k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $314k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads 58/100 on livability (#305 in TN) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A+; Watch: crime F, amenities F, commute F.
• Manchester (town): math 31% / reading 29% proficiency, ranked #61 of 139 in TN (top 44%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: College Street Elementary (math 42% / reading 32%, grade F, #272 of 952 statewide, top 31%, 547 students, 0% FRL) — zoned schools average 0% FRL vs 52% district-wide (52 pts lower); this property's tenant base skews higher-income than the district average.
• Watch-outs: built in 1905 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 206 active listings in the ZIP; 389 units permitted in Coffee County in 2024 (6 in 5+ unit buildings).
• Coffee County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $89k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: moderate wildfire risk; extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 18.7% vs local median 3.1% in Manchester — 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.
• At $6,629/mo this rent would consume 126% of the median local household income ($63k/yr) (locally 401% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1905 — 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 F-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.