The Callaghan (830) Plan

Mont Belvieu, TX 77523

$290,390D-

3 bd · 2.0 ba · 1,688 sqft · Built — · SingleFamily · Active · 870 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,379/mo
• Mortgage (P&I): −$1,611
• Tax + insurance: −$512
• HOA: −$0
• Vac / Maint / Mgmt: −$500
• Net cashflow: $-244/mo
• Annual: $-2,925/yr
• Cap rate: 5.34%
• Cash-on-cash: -3.40%
• DSCR: 0.85
• 1% rule: 0.77%
• Cash to close: $86,012

Investor read

• This is a 3-bed/2.0-bath single-family listed at $290k. Condition is rated fair.
• At list price, monthly cash flow is $-244 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $272k (6.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $238k (18.1% below list).
• It's been on market 870 days — a 12% lower offer ($256k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $238k (18.1% below list) — sets the bar for 1% rule.
• 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 69/100 on livability (#438 in TX) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, schools A-; Watch: amenities F, commute F, health & safety F.
• Barbers Hill ISD (rural): math 72% / reading 65% proficiency, ranked #12 of 826 in TX (top 2%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising (+3.4%/yr); 781 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 629 units permitted in Chambers County in 2024 (0 in 5+ unit buildings).
• Chambers County population projected at +46% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: moderate flood risk; 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 5.3% vs local median 2.6% in Mont Belvieu — 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 870 days. Have you received any prior offers? Is the seller open to a 18% concession, seller financing, or rate buy-down credit?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• 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 A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.

Repairs flagged (vision-AI assessment)

• Minor: Paint — Paint appears slightly faded