1405 Caddo St

Commerce, TX 75428

$149,999C-

3 bd · 4.0 ba · 2,605 sqft · Built 1915 · SingleFamily · Active · 59 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,726/mo
• Mortgage (P&I): −$787
• Tax + insurance: −$492
• HOA: −$0
• Vac / Maint / Mgmt: −$362
• Net cashflow: $85/mo
• Annual: $1,022/yr
• Cap rate: 6.97%
• Cash-on-cash: 2.43%
• DSCR: 1.11
• 1% rule: 1.15%
• Cash to close: $42,000

Investor read

• This is a 3-bed/4.0-bath single-family listed at $150k.
• At list price, monthly cash flow is $85 ($1k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $150k).
• It's been on market 59 days — a 3% lower offer ($145k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $145k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#737 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A-; Watch: crime C-, amenities F, commute F.
• Commerce ISD (rural): math 23% / reading 33% proficiency, ranked #687 of 826 in TX (top 83%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 62% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Commerce El (400 students, 78% FRL); Commerce Middle (math 21% / reading 31%, grade F, #1,222 of 1,662 statewide, top 74%, 331 students, 78% FRL); Commerce H S (math 17% / reading 52%, grade F, #963 of 1,632 statewide, top 61%, 465 students, 68% FRL).
• Watch-outs: property tax is 3.4% of price; built in 1915 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 211 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals at typical pace (median 14d on market — plan ~3-4 weeks tenant-placement turnaround); 1,289 units permitted in Hunt County in 2024 (527 in 5+ unit buildings).
• Hunt County population projected at +15% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 4 sale attempts since 20y 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.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; major wildfire risk; extreme-heat days projected 7→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.0% vs local median 2.1% in Commerce — 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 40% of the median local income ($51k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 59 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1915 — 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 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?
• 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.