9842 Lum Ln

Houston, TX 77078

$128,000D+

1 bd · 1.0 ba · 927 sqft · Built 1968 · SingleFamily · Active · 71 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,113/mo
• Mortgage (P&I): −$671
• Tax + insurance: −$342
• HOA: −$0
• Vac / Maint / Mgmt: −$234
• Net cashflow: $-133/mo
• Annual: $-1,601/yr
• Cap rate: 5.04%
• Cash-on-cash: -4.47%
• DSCR: 0.80
• 1% rule: 0.87%
• Cash to close: $35,840

Investor read

• This is a 1-bed/1.0-bath single-family listed at $128k.
• At list price, monthly cash flow is $-133 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $104k (18.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $111k (13.0% below list).
• It's been on market 71 days — a 6% lower offer ($120k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $104k (18.4% below list) — sets the bar for cash-flow.
• In year one you build about $4k of equity ($885 loan paydown + $3k appreciation (2.5% local appreciation)).
• 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: schools D, 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.
• Watch-outs: property tax is 2.7% of price.
• Market conditions: 129 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 43% of comp listings sitting > 30 days — soft ceiling on asking rent; lower-income renter base — watch delinquency; 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.
• 6 sale attempts since 3y ago; this cycle's ask has dropped $12k (9%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $17k; list at $128k implies a 653% gain — meaningful room to come down on a strong offer.
• By year 8, paydown + projected appreciation supports a ~$30k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→25/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.0% 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.
• This rent runs 34% of the median local income ($39k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 71 days. Have you received any prior offers? Is the seller open to a 18% concession, seller financing, or rate buy-down credit?
• Built in 1968 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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 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?