Bailey Plan

Brookshire, TX 77423

$305,990F

5 bd · 2.0 ba · 1,943 sqft · Built — · SingleFamily · Active · 215 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,487/mo
• Mortgage (P&I): −$1,746
• Tax + insurance: −$555
• HOA: −$0
• Vac / Maint / Mgmt: −$522
• Net cashflow: $-336/mo
• Annual: $-4,032/yr
• Cap rate: 5.08%
• Cash-on-cash: -4.33%
• DSCR: 0.81
• 1% rule: 0.75%
• Cash to close: $93,211

Investor read

• This is a 5-bed/2.0-bath single-family listed at $306k. Condition is rated good.
• At list price, monthly cash flow is $-336 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $284k (7.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $249k (18.7% below list).
• It's been on market 215 days — a 12% lower offer ($269k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $249k (18.7% 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 $10k of value loss. Plan a longer hold.
• Location reads 62/100 on livability (#960 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: crime D-, amenities F, commute F.
• Royal ISD (rural): math 23% / reading 23% proficiency, ranked #744 of 826 in TX (top 90%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 77% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Royal El (math 27% / reading 20%, grade F, #3,247 of 4,322 statewide, top 76%, 762 students, 78% FRL); Royal J H (math 22% / reading 23%, grade F, #1,341 of 1,662 statewide, top 82%, 593 students, 73% FRL); Royal H S (math 17% / reading 26%, grade F, #1,377 of 1,632 statewide, top 85%, 842 students, 71% FRL) — zoned schools at 74% FRL track the district average.
• Market conditions: Rents soft (-1.0%/yr); 1404 active listings in the ZIP; solid renter incomes; 483 units permitted in Waller County in 2024 (89 in 5+ unit buildings).
• Waller County population projected at +62% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• This rent runs 35% of the median local income ($84k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 215 days. Have you received any prior offers? Is the seller open to a 19% concession, seller financing, or rate buy-down credit?
• 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?
• Crime grade is D 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?
• 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.