4801 81st St

Hampton, VA 23605

$172,000C+

3 bd · 1.0 ba · 1,248 sqft · Built 1961 · SingleFamily · Under Contract · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,749/mo
• Mortgage (P&I): −$902
• Tax + insurance: −$307
• HOA: −$0
• Vac / Maint / Mgmt: −$367
• Net cashflow: $173/mo
• Annual: $2,076/yr
• Cap rate: 7.50%
• Cash-on-cash: 4.31%
• DSCR: 1.19
• 1% rule: 1.02%
• Cash to close: $48,160

Investor read

• This is a 3-bed/1.0-bath single-family listed at $172k.
• At list price, monthly cash flow is $173 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $172k).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• 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 75/100 on livability (#133 in VA, #4,302 nationally) — a middle-class / working-renter tenant base. Strengths: housing A+, health & safety A+, cost of living A; Watch: crime C-, amenities D+, commute F.
• Hampton City Public School District (urban): math 60% / reading 70% proficiency, ranked #40 of 131 in VA (top 30%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Alfred S. Forrest Elementary (math 47% / reading 62%, grade C, #650 of 1,108 statewide, top 62%, 540 students, 85% FRL); Cesar Tarrant Middle (math 64% / reading 71%, grade A-, #98 of 342 statewide, top 30%, 676 students, 74% FRL); Bethel High (math 64% / reading 84%, grade B+, #120 of 319 statewide, top 38%, 1,777 students, 86% FRL) — zoned schools average 82% FRL vs 49% district-wide (33 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising fast (+8.9%/yr); 43 active listings in the ZIP; 20 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 68 units permitted in Hampton city in 2024 (0 in 5+ unit buildings).
• Hampton County population projected at -13% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $126k; 36% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $48k cash investment doubles in ~10 years — after that, you're playing with house money.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.5% vs local median 4.5% in Hampton — 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 39% of the median local income ($54k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1961 — 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 B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.