705 W Green St

Palestine, TX 75801

$54,900B-

3 bd · 2.0 ba · 1,528 sqft · Built 1900 · SingleFamily · Active · 27 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,505/mo
• Mortgage (P&I): −$288
• Tax + insurance: −$201
• HOA: −$0
• Vac / Maint / Mgmt: −$316
• Net cashflow: $700/mo
• Annual: $8,397/yr
• Cap rate: 21.59%
• Cash-on-cash: 54.62%
• DSCR: 3.43
• 1% rule: 2.74%
• Cash to close: $15,372

Investor read

• This is a 3-bed/2.0-bath single-family listed at $55k. Condition is rated fair.
• At list price, monthly cash flow is $700 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $55k).
• It's been on market 27 days — a 2% lower offer ($54k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $54k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $380 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#657 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: crime D+, employment D, amenities F.
• Palestine ISD (town): math 36% / reading 37% proficiency, ranked #509 of 826 in TX (top 62%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Northside Pri (465 students, 80% FRL); Palestine J H (math 41% / reading 44%, grade D-, #553 of 1,662 statewide, top 34%, 493 students, 78% FRL); Palestine H S (math 44% / reading 41%, grade F, #721 of 1,632 statewide, top 45%, 998 students, 77% FRL).
• Watch-outs: property tax is 3.9% of price; built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 309 active listings in the ZIP; 29 units permitted in Anderson County in 2024 (0 in 5+ unit buildings).
• Anderson County population projected at +4% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 4 sale attempts since 4y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $15k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 74% 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.
• Cap rate 21.6% vs local median 4.2% in Palestine — 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 32% of the median local income ($57k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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.

Repairs flagged (vision-AI assessment)

• Major: roof — Signs of wear and potential leaks indicate a major repair is needed.
• Major: exterior paint — Peeling paint suggests a major repainting is required.
• Major: HVAC system — The system appears old and may need replacement or repair.