409 Ash St

Lexington-Fayette, KY 40508

$92,000B

1 bd · 1.0 ba · 1,004 sqft · Built 1943 · SingleFamily · Pending · 93 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,496/mo
• Mortgage (P&I): −$482
• Tax + insurance: −$74
• HOA: −$0
• Vac / Maint / Mgmt: −$314
• Net cashflow: $626/mo
• Annual: $7,510/yr
• Cap rate: 14.46%
• Cash-on-cash: 29.15%
• DSCR: 2.30
• 1% rule: 1.63%
• Cash to close: $25,760

Investor read

• This is a 1-bed/1.0-bath single-family listed at $92k.
• At list price, monthly cash flow is $626 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $92k).
• It's been on market 93 days — a 9% lower offer ($84k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $84k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $636 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads: area grade B — affects rentability + tenant quality, not the cash-flow math above.
• Fayette County (urban): math 35% / reading 45% proficiency, ranked #27 of 165 in KY (top 16%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Booker T Washington Elementary School (math 17% / reading 17%, grade F, #607 of 676 statewide, top 91%, 313 students, 83% FRL); Leestown Middle School (math 28% / reading 44%, grade F, #91 of 217 statewide, top 43%, 966 students, 52% FRL); Paul Laurence Dunbar High School (math 51% / reading 49%, grade D+, #12 of 254 statewide, top 4%, 1,946 students, 46% FRL) — zoned schools average 60% FRL vs 44% district-wide (16 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1943 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+11.8%/yr); 82 active listings in the ZIP; 14 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 1,036 units permitted in Fayette County in 2024 (542 in 5+ unit buildings).
• Fayette County population projected at +35% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 5 sale attempts since 16y ago; this cycle's ask has dropped $68k (42%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $26k cash investment doubles in ~4 years — after that, you're playing with house money.
• Cap rate 14.5% vs local median 3.8% in Lexington-Fayette — 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 $1,496/mo this rent would consume 61% of the median local household income ($29k/yr) (locally 2644% 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 93 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1943 — 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.
• 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.