5102 Panay Park Dr

Houston, TX 77048

$219,990D+

3 bd · 2.0 ba · 2,210 sqft · Built 2007 · SingleFamily · Pending · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,880/mo
• Mortgage (P&I): −$1,154
• Tax + insurance: −$562
• HOA: −$0
• Vac / Maint / Mgmt: −$395
• Net cashflow: $-230/mo
• Annual: $-2,763/yr
• Cap rate: 5.04%
• Cash-on-cash: -4.49%
• DSCR: 0.80
• 1% rule: 0.85%
• Cash to close: $61,597

Investor read

• This is a 3-bed/2.0-bath single-family listed at $220k.
• At list price, monthly cash flow is $-230 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $179k (18.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $188k (14.5% below list).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $179k (18.5% below list) — sets the bar for cash-flow.
• In year one you build about $7k of equity ($2k loan paydown + $6k appreciation (2.6% 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: 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: Thomas Middle (math 3% / reading 13%, grade F, #1,654 of 1,662 statewide, top 100%, 526 students, 98% FRL); Sterling H S (math 16% / reading 27%, grade F, #1,377 of 1,632 statewide, top 85%, 1,421 students, 92% FRL) — zoned schools average 95% FRL vs 71% district-wide (24 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 15% at this address vs 31% district-wide (-16 pts) — the specific schools serving this property underperform the Houston ISD average; the district grade overstates school quality for this exact location.
• Watch-outs: property tax is 2.6% of price.
• Market conditions: Rents rising (+1.2%/yr); 303 active listings in the ZIP; 11 comparable units currently listed for rent nearby; rentals at typical pace (median 21d on market — plan ~3-4 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.
• 4 sale attempts since 17y ago; this cycle's ask is 5% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• By year 5, paydown + projected appreciation supports a ~$32k 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→24/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.

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?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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?
• 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.