2109 Castro Ave

Hondo, TX 78861

$75,000B-

3 bd · 2.0 ba · 952 sqft · Built 1950 · SingleFamily · Active · 161 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,195/mo
• Mortgage (P&I): −$393
• Tax + insurance: −$188
• HOA: −$0
• Vac / Maint / Mgmt: −$251
• Net cashflow: $363/mo
• Annual: $4,358/yr
• Cap rate: 12.10%
• Cash-on-cash: 20.75%
• DSCR: 1.92
• 1% rule: 1.59%
• Cash to close: $21,000

Investor read

• This is a 3-bed/2.0-bath single-family listed at $75k.
• At list price, monthly cash flow is $363 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $75k).
• It's been on market 161 days — a 12% lower offer ($66k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $66k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $519 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#872 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing B+; Watch: schools F, amenities F, commute F.
• Hondo ISD (town): math 35% / reading 36% proficiency, ranked #502 of 826 in TX (top 61%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: property tax is 2.5% of price; built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 117 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 102 units permitted in Medina County in 2024 (0 in 5+ unit buildings).
• Medina County population projected at +24% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 5 sale attempts 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.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $21k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: major wind risk, 68% chance of damaging wind over 30y; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 12.1% vs local median 2.5% in Hondo — 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

• It's been on market 161 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1950 — 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?
• 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 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.