2626 Holly Hall St #409

Houston, TX 77054

$75,000C

1 bd · 1.0 ba · 664 sqft · Built 1984 · Condo · Active · 55 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,078/mo
• Mortgage (P&I): −$393
• Tax + insurance: −$228
• HOA: −$285
• Vac / Maint / Mgmt: −$226
• Net cashflow: $-54/mo
• Annual: $-649/yr
• Cap rate: 6.49%
• Cash-on-cash: 0.71%
• DSCR: 1.03
• 1% rule: 1.44%
• Cash to close: $21,000

Investor read

• This is a 1-bed/1.0-bath condo listed at $75k.
• At list price, monthly cash flow is $-54 ($-649/yr) — negative.
• To cash-flow at today's rent, offer at most $65k (12.7% below list).
• Meets the 1% rule at list price ($1k rent vs $75k).
• It's been on market 55 days — a 3% lower offer ($73k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $65k (12.7% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $519 of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#184 in TX, #4,771 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, cost of living A+, housing A+; Watch: crime F.
• Houston ISD (urban): math 27% / reading 35% proficiency, ranked #593 of 826 in TX (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 71% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Cullen Middle (math 6% / reading 14%, grade F, #1,641 of 1,662 statewide, top 99%, 324 students, 100% FRL); Yates H S (math 12% / reading 23%, grade F, #1,451 of 1,632 statewide, top 89%, 851 students, 96% FRL) — zoned schools average 98% FRL vs 71% district-wide (27 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 14% at this address vs 31% district-wide (-17 pts) — the specific schools serving this property underperform the Houston ISD average; the district grade overstates school quality for this exact location.
• Watch-outs: flood insurance adds $66/mo; HOA is 26% of rent.
• Market conditions: Rents soft (-2.8%/yr); 268 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals leasing fast (median 12d on market — plan ~1-2 weeks tenant-placement turnaround); 29,883 units permitted in Harris County in 2024 (8,621 in 5+ unit buildings).
• Harris County population projected at +47% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 12 sale attempts since 13y ago; this cycle's ask is 7795% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $28k; list at $75k implies a 168% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe flood risk; severe wind risk, 99% 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 6.5% vs local median 3.2% in Houston — 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 55 days. Have you received any prior offers? Is the seller open to a 13% concession, seller financing, or rate buy-down credit?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-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 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?