3913 Winnie St

Galveston, TX 77550

$165,000B

2 bd · 2.0 ba · 1,066 sqft · Built 1950 · MultiFamily · Active · 108 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,090/mo
• Mortgage (P&I): −$865
• Tax + insurance: −$697
• HOA: −$0
• Vac / Maint / Mgmt: −$439
• Net cashflow: $89/mo
• Annual: $1,069/yr
• Cap rate: 10.04%
• Cash-on-cash: 13.39%
• DSCR: 1.60
• 1% rule: 1.27%
• Cash to close: $46,200

Investor read

• This is a 2 × 1-bed/1.0-bath units multifamily listed at $165k.
• At list price, monthly cash flow is $89 ($1k/yr) — positive. Per door: $45/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $165k).
• It's been on market 108 days — a 9% lower offer ($150k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $150k (9.0% 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 $5k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#108 in TX, #3,559 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: amenities D+, employment D, crime F.
• Galveston ISD (town): math 33% / reading 39% proficiency, ranked #514 of 826 in TX (top 62%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: flood insurance adds $427/mo; built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents soft (-1.1%/yr); 622 active listings in the ZIP; 38 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 58% of comp listings sitting > 30 days — soft ceiling on asking rent; 3,258 units permitted in Galveston County in 2024 (0 in 5+ unit buildings).
• Galveston County population projected at +43% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 9 sale attempts since 4y ago; this cycle's ask has dropped $15k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→27/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.0% vs local median 0.1% in Galveston — 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 $2,090/mo this rent would consume 56% of the median local household income ($45k/yr) (locally 2193% 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 108 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1950 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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.
• Crime grade is F 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?