Heritage Barndominium Plan

Katy, TX 77494

$340,919F

4 bd · 3.5 ba · 2,688 sqft · Built — · SingleFamily · Active · 669 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,491/mo
• Mortgage (P&I): −$2,732
• Tax + insurance: −$868
• HOA: −$0
• Vac / Maint / Mgmt: −$523
• Net cashflow: $-1,632/mo
• Annual: $-19,588/yr
• Cap rate: 2.53%
• Cash-on-cash: -13.43%
• DSCR: 0.40
• 1% rule: 0.48%
• Cash to close: $145,857

Investor read

• This is a 4-bed/3.5-bath single-family listed at $341k.
• At list price, monthly cash flow is $-2k ($-20k/yr) — negative.
• To cash-flow at today's rent, offer at most $285k (16.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $249k (26.9% below list).
• It's been on market 669 days — a 12% lower offer ($300k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $249k (26.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $16k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#111 in TX, #3,613 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, cost of living A+, housing A+; Watch: crime C-, amenities D, commute F.
• Katy ISD (suburban): math 61% / reading 63% proficiency, ranked #29 of 826 in TX (top 4%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents falling (-3.5%/yr); 1036 active listings in the ZIP; high-income renter base; 12,093 units permitted in Fort Bend County in 2024 (815 in 5+ unit buildings).
• Fort Bend County population projected at +75% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 2y ago; this cycle's ask has dropped $22k (6%) from the opening price — seller is motivated, your offer sets the floor, not the list.

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 669 days. Have you received any prior offers? Is the seller open to a 27% 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 B-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.