1203 Middlecreek St

Friendswood, TX 77546

$360,000D

4 bd · 2.0 ba · 2,066 sqft · Built 1983 · SingleFamily · Active · 195 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,837/mo
• Mortgage (P&I): −$1,888
• Tax + insurance: −$797
• HOA: −$29
• Vac / Maint / Mgmt: −$596
• Net cashflow: $-473/mo
• Annual: $-5,670/yr
• Cap rate: 4.72%
• Cash-on-cash: -5.63%
• DSCR: 0.75
• 1% rule: 0.79%
• Cash to close: $100,800

Investor read

• This is a 4-bed/2.0-bath single-family listed at $360k.
• At list price, monthly cash flow is $-473 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $277k (23.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $284k (21.2% below list).
• It's been on market 195 days — a 12% lower offer ($317k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $277k (23.2% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $11k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#338 in TX) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: amenities F, commute F, health & safety F.
• Friendswood ISD (suburban): math 64% / reading 65% proficiency, ranked #15 of 826 in TX (top 2%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 8% free/reduced lunch — higher-income household profile.
• Zoned schools: C W Cline El (math 62% / reading 67%, grade B, #257 of 4,322 statewide, top 6%, 801 students, 8% FRL); Friendswood J H (math 62% / reading 59%, grade B+, #154 of 1,662 statewide, top 9%, 1,467 students, 0% FRL); Friendswood H S (math 61% / reading 76%, grade B, #144 of 1,632 statewide, top 9%, 1,980 students, 0% FRL).
• Market conditions: Rents rising (+2.7%/yr); 512 active listings in the ZIP; 2 comparable units currently listed for rent nearby; high-income renter base; 3,258 units permitted in Galveston County in 2024 (0 in 5+ unit buildings).
• Galveston County population projected at +43% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 7y ago; this cycle's ask has dropped $90k (20%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• 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 4.7% vs local median 2.4% in Friendswood — 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 195 days. Have you received any prior offers? Is the seller open to a 23% 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 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.