542 Paris St

San Marcos, TX 78656

$225,990D

4 bd · 2.0 ba · 1,707 sqft · Built 2026 · Land · Pending · 161 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,021/mo
• Mortgage (P&I): −$1,185
• Tax + insurance: −$377
• HOA: −$45
• Vac / Maint / Mgmt: −$424
• Net cashflow: $-11/mo
• Annual: $-127/yr
• Cap rate: 6.24%
• Cash-on-cash: -0.20%
• DSCR: 0.99
• 1% rule: 0.89%
• Cash to close: $63,277

Investor read

• This is a 4-bed/2.0-bath land listed at $226k.
• At list price, monthly cash flow is $-11 ($-127/yr) — negative.
• To cash-flow at today's rent, offer at most $224k (0.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $202k (10.6% below list).
• It's been on market 161 days — a 12% lower offer ($199k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $199k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-1.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#30 in TX, #1,601 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, cost of living A+, health & safety A+; Watch: crime D+, employment F.
• Lockhart ISD (town): math 27% / reading 29% proficiency, ranked #657 of 826 in TX (top 80%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 62% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Navarro El (math 27% / reading 30%, grade F, #2,706 of 4,322 statewide, top 63%, 580 students, 72% FRL); Lockhart J H (math 22% / reading 26%, grade F, #1,301 of 1,662 statewide, top 79%, 1,433 students, 74% FRL); Lockhart H S (math 21% / reading 33%, grade F, #1,204 of 1,632 statewide, top 75%, 1,968 students, 69% FRL).
• Market conditions: Rents falling (-5.4%/yr); 337 active listings in the ZIP; 35 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 529 units permitted in Caldwell County in 2024 (6 in 5+ unit buildings).
• Caldwell County population projected at +33% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts; this cycle's ask has dropped $60k (21%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Cap rate 6.2% vs local median 3.2% in San Marcos — 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 161 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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?