Magnolia Bayou Plan

Dickinson, TX 77539

$325,000F

3 bd · 2.0 ba · 1,664 sqft · Built — · SingleFamily · Active · 243 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,714/mo
• Mortgage (P&I): −$1,752
• Tax + insurance: −$983
• HOA: −$50
• Vac / Maint / Mgmt: −$360
• Net cashflow: $-1,431/mo
• Annual: $-17,173/yr
• Cap rate: 2.68%
• Cash-on-cash: -12.89%
• DSCR: 0.43
• 1% rule: 0.51%
• Cash to close: $93,547

Investor read

• This is a 3-bed/2.0-bath single-family listed at $325k. Condition is rated good.
• At list price, monthly cash flow is $-1k ($-17k/yr) — negative.
• To cash-flow at today's rent, offer at most $127k (60.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $171k (47.3% below list).
• It's been on market 243 days — a 12% lower offer ($286k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $127k (60.9% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads 67/100 on livability (#533 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, employment A-; Watch: amenities F, commute F, health & safety F.
• Dickinson ISD (suburban): math 39% / reading 40% proficiency, ranked #366 of 826 in TX (top 44%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 60% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Calder Road El (math 56% / reading 50%, grade C, #705 of 4,322 statewide, top 17%, 722 students, 59% FRL); Dunbar Middle (math 25% / reading 20%, grade F, #1,341 of 1,662 statewide, top 82%, 654 students, 78% FRL); Dickinson H S (math 30% / reading 46%, grade F, #880 of 1,632 statewide, top 54%, 3,619 students, 64% FRL).
• Watch-outs: flood insurance adds $427/mo.
• Market conditions: Rents soft (-0.1%/yr); 844 active listings in the ZIP; 12 comparable units currently listed for rent nearby; rentals lingering (median 66d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 83% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 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.
• 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 6→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

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 243 days. Have you received any prior offers? Is the seller open to a 61% concession, seller financing, or rate buy-down credit?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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?