Cascade Plan

Texas City, TX 77590

$313,990B-

4 bd · 2.0 ba · 2,538 sqft · Built — · SingleFamily · Active · 404 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,531/mo
• Mortgage (P&I): −$1,495
• Tax + insurance: −$475
• HOA: −$0
• Vac / Maint / Mgmt: −$952
• Net cashflow: $1,610/mo
• Annual: $19,318/yr
• Cap rate: 13.07%
• Cash-on-cash: 24.20%
• DSCR: 2.08
• 1% rule: 1.59%
• Cash to close: $79,811

Investor read

• This is a 4-bed/2.0-bath single-family listed at $314k.
• At list price, monthly cash flow is $2k ($19k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($5k rent vs $314k).
• It's been on market 404 days — a 12% lower offer ($276k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $276k (12.0% below list) — sets the bar for market timing.
• 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 62/100 on livability (#907 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: crime D+, schools F, amenities F.
• Texas City ISD (suburban): math 28% / reading 29% proficiency, ranked #655 of 826 in TX (top 79%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 66% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising fast (+4.9%/yr); 292 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 2d on market — plan ~1-2 weeks tenant-placement turnaround); 3,258 units permitted in Galveston County in 2024 (0 in 5+ unit buildings).
• Galveston County population projected at +43% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts; this cycle's ask has dropped $52k (14%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 4.9% rent growth), your $80k cash investment doubles in ~5 years — after that, you're playing with house money.
• Cap rate 13.1% vs local median 4.3% in Texas City — 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.
• At $4,531/mo this rent would consume 83% of the median local household income ($66k/yr) (locally 1821% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 404 days. Have you received any prior offers? Is the seller open to a 12% 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?
• 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.