131 E 31st 1/2 St

Houston, TX 77018

$250,000D

2 bd · 1.0 ba · 851 sqft · Built 1950 · SingleFamily · Active · 277 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,015/mo
• Mortgage (P&I): −$1,311
• Tax + insurance: −$384
• HOA: −$0
• Vac / Maint / Mgmt: −$423
• Net cashflow: $-103/mo
• Annual: $-1,240/yr
• Cap rate: 5.80%
• Cash-on-cash: -1.77%
• DSCR: 0.92
• 1% rule: 0.81%
• Cash to close: $70,000

Investor read

• This is a 2-bed/1.0-bath single-family listed at $250k.
• At list price, monthly cash flow is $-103 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $232k (7.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $201k (19.4% below list).
• It's been on market 277 days — a 12% lower offer ($220k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $201k (19.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#184 in TX, #4,771 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, cost of living A+, housing A+; Watch: crime F.
• Houston ISD (urban): math 27% / reading 35% proficiency, ranked #593 of 826 in TX (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 71% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Burrus El (math 22% / reading 27%, grade F, #3,052 of 4,322 statewide, top 74%, 246 students, 98% FRL); Hamilton Middle (math 30% / reading 44%, grade F, #756 of 1,662 statewide, top 47%, 823 students, 86% FRL); Washington B T H S (math 27% / reading 25%, grade F, #1,234 of 1,632 statewide, top 76%, 878 students, 96% FRL) — zoned schools average 93% FRL vs 71% district-wide (22 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.1%/yr); 508 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals leasing fast (median 13d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 29,883 units permitted in Harris County in 2024 (8,621 in 5+ unit buildings).
• Harris County population projected at +47% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 12y ago; this cycle's ask has dropped $149k (37%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: moderate flood risk; severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.8% vs local median 3.1% in Houston — 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.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 277 days. Have you received any prior offers? Is the seller open to a 19% concession, seller financing, or rate buy-down credit?
• Built in 1950 — 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.
• 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 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?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?