2321 Kale Dr

Austin, TX 78725

$274,472D

3 bd · 2.0 ba · 1,096 sqft · Built 2010 · SingleFamily · Pending · 39 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,015/mo
• Mortgage (P&I): −$1,439
• Tax + insurance: −$413
• HOA: −$21
• Vac / Maint / Mgmt: −$423
• Net cashflow: $-281/mo
• Annual: $-3,373/yr
• Cap rate: 5.06%
• Cash-on-cash: -4.39%
• DSCR: 0.80
• 1% rule: 0.73%
• Cash to close: $76,852

Investor read

• This is a 3-bed/2.0-bath single-family listed at $274k.
• At list price, monthly cash flow is $-281 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $225k (18.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $202k (26.6% below list).
• It's been on market 39 days — a 3% lower offer ($266k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $202k (26.6% 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 $8k of value loss. Plan a longer hold.
• Location reads 82/100 on livability (#16 in TX, #1,208 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, employment A+; Watch: cost of living D, crime F.
• Del Valle ISD (rural): math 19% / reading 26% proficiency, ranked #749 of 826 in TX (top 91%) — 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: Hornsby-Dunlap El (math 17% / reading 20%, grade F, #3,759 of 4,322 statewide, top 88%, 599 students, 92% FRL); Dailey Middle (math 23% / reading 27%, grade F, #1,258 of 1,662 statewide, top 77%, 834 students, 94% FRL); Del Valle H S (math 17% / reading 28%, grade F, #1,354 of 1,632 statewide, top 83%, 3,460 students, 90% FRL).
• Market conditions: Rents soft (-0.5%/yr); 98 active listings in the ZIP; 11 comparable units currently listed for rent nearby; rentals leasing fast (median 6d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 17,121 units permitted in Travis County in 2024 (11,963 in 5+ unit buildings).
• Travis County population projected at +60% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 6 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, 80% chance of damaging wind over 30y; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.1% vs local median 1.8% in Austin — 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 39 days. Have you received any prior offers? Is the seller open to a 27% 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.
• Crime grade is F 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.
• 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.