807 Garrison St

Waco, TX 76704

$110,000B-

3 bd · 1.0 ba · 1,160 sqft · Built 1955 · SingleFamily · Active · 36 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,401/mo
• Mortgage (P&I): −$577
• Tax + insurance: −$271
• HOA: −$0
• Vac / Maint / Mgmt: −$294
• Net cashflow: $259/mo
• Annual: $3,111/yr
• Cap rate: 9.12%
• Cash-on-cash: 10.10%
• DSCR: 1.45
• 1% rule: 1.27%
• Cash to close: $30,800

Investor read

• This is a 3-bed/1.0-bath single-family listed at $110k.
• At list price, monthly cash flow is $259 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $110k).
• It's been on market 36 days — a 3% lower offer ($107k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $107k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $761 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#166 in TX, #4,378 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: crime D, commute F, employment D-.
• Waco ISD (urban): math 20% / reading 24% proficiency, ranked #773 of 826 in TX (top 94%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 81% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: J H Hines El (math 8% / reading 12%, grade F, #4,259 of 4,322 statewide, top 99%, 406 students, 98% FRL, charter) — zoned schools average 98% FRL vs 81% district-wide (16 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 10% at this address vs 22% district-wide (-12 pts) — the specific schools serving this property underperform the Waco ISD average; the district grade overstates school quality for this exact location.
• Watch-outs: built in 1955 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 86 active listings in the ZIP; 22 comparable units currently listed for rent nearby; rentals leasing fast (median 14d on market — plan ~1-2 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 1,014 units permitted in McLennan County in 2024 (200 in 5+ unit buildings).
• McLennan County population projected at +17% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: major flood risk; major wind risk, 58% chance of damaging wind over 30y; extreme-heat days projected 7→25/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 9.1% vs local median 3.9% in Waco — 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 $1,401/mo this rent would consume 55% of the median local household income ($30k/yr) (locally 603% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 36 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1955 — 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 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 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.