1054 Morelos

Seguin, TX 78155

$135,000C-

2 bd · 1.0 ba · 560 sqft · Built 1950 · SingleFamily · Pending · 30 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,171/mo
• Mortgage (P&I): −$708
• Tax + insurance: −$128
• HOA: −$0
• Vac / Maint / Mgmt: −$246
• Net cashflow: $89/mo
• Annual: $1,066/yr
• Cap rate: 7.08%
• Cash-on-cash: 2.82%
• DSCR: 1.13
• 1% rule: 0.87%
• Cash to close: $37,800

Investor read

• This is a 2-bed/1.0-bath single-family listed at $135k.
• At list price, monthly cash flow is $89 ($1k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $117k (13.3% below list).
• It's been on market 30 days — a 2% lower offer ($133k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $117k (13.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $933 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#592 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: employment D, amenities F, commute F.
• Seguin ISD (town): math 26% / reading 30% proficiency, ranked #663 of 826 in TX (top 80%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 63% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Mcqueeney El (math 17% / reading 17%, grade F, #3,836 of 4,322 statewide, top 91%, 314 students, 84% FRL); Briesemeister Middle (math 17% / reading 22%, grade F, #1,445 of 1,662 statewide, top 88%, 725 students, 77% FRL); Seguin H S (math 24% / reading 43%, grade F, #1,011 of 1,632 statewide, top 63%, 2,101 students, 71% FRL).
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.0%/yr); 1377 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals at typical pace (median 21d on market — plan ~3-4 weeks tenant-placement turnaround); 2,064 units permitted in Guadalupe County in 2024 (133 in 5+ unit buildings).
• Guadalupe County population projected at +61% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 2y 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, 80% 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 7.1% vs local median 3.7% in Seguin — 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

• Built in 1950 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.