708 Main Ave

Erwin, TN 37650

$154,900C-

2 bd · 1.0 ba · 1,066 sqft · Built 1925 · SingleFamily · Active · 103 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,385/mo
• Mortgage (P&I): −$812
• Tax + insurance: −$125
• HOA: −$0
• Vac / Maint / Mgmt: −$291
• Net cashflow: $157/mo
• Annual: $1,880/yr
• Cap rate: 7.51%
• Cash-on-cash: 4.33%
• DSCR: 1.19
• 1% rule: 0.89%
• Cash to close: $43,372

Investor read

• This is a 2-bed/1.0-bath single-family listed at $155k.
• At list price, monthly cash flow is $157 ($2k/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 $138k (10.6% below list).
• It's been on market 103 days — a 9% lower offer ($141k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $138k (10.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 61/100 on livability (#241 in TN) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: schools F, crime F, amenities F.
• Unicoi County (town): math 25% / reading 26% proficiency, ranked #88 of 139 in TN (top 63%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: built in 1925 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 71 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals leasing fast (median 14d on market — plan ~1-2 weeks tenant-placement turnaround); 24 units permitted in Unicoi County in 2024 (0 in 5+ unit buildings).
• Unicoi County population projected at -16% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 4y ago; this cycle's ask has dropped $15k (9%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $92k; list at $155k implies a 68% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 9→26/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.5% vs local median 3.5% in Erwin — 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

• It's been on market 103 days. Have you received any prior offers? Is the seller open to a 11% concession, seller financing, or rate buy-down credit?
• Built in 1925 — 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 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.