4107 Merlet Dr

Pearland, TX 77584

$286,500D-

3 bd · 3.0 ba · 1,513 sqft · Built 2002 · SingleFamily · Active · 36 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,491/mo
• Mortgage (P&I): −$1,502
• Tax + insurance: −$632
• HOA: −$20
• Vac / Maint / Mgmt: −$523
• Net cashflow: $-186/mo
• Annual: $-2,238/yr
• Cap rate: 5.51%
• Cash-on-cash: -2.79%
• DSCR: 0.88
• 1% rule: 0.87%
• Cash to close: $80,220

Investor read

• This is a 3-bed/3.0-bath single-family listed at $286k.
• At list price, monthly cash flow is $-186 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $254k (11.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $249k (13.0% below list).
• It's been on market 36 days — a 3% lower offer ($278k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $249k (13.0% 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 $9k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#32 in TX, #1,539 nationally) — a professional / high-income tenant draw. Strengths: employment A+, housing A+, crime A; Watch: amenities D-, commute F.
• Pearland ISD (suburban): math 58% / reading 59% proficiency, ranked #47 of 826 in TX (top 6%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Pearland J H South (math 56% / reading 58%, grade B, #212 of 1,662 statewide, top 13%, 895 students, 52% FRL); Pearland H S (math 58% / reading 64%, grade C+, #258 of 1,632 statewide, top 16%, 3,261 students, 36% FRL) — zoned schools average 44% FRL vs 26% district-wide (18 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising (+1.5%/yr); 497 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 12d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 3,960 units permitted in Brazoria County in 2024 (593 in 5+ unit buildings).
• Brazoria County population projected at +44% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 15y ago 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.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.5% vs local median 3.0% in Pearland — 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 36 days. Have you received any prior offers? Is the seller open to a 13% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are A-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?
• 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?
• 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.