401 Island Ave Unit 60A

Port Isabel, TX 78578

$185,000F

2 bd · 1.0 ba · 800 sqft · Built 1985 · Condo · Active · 127 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,061/mo
• Mortgage (P&I): −$970
• Tax + insurance: −$735
• HOA: −$850
• Vac / Maint / Mgmt: −$433
• Net cashflow: $-927/mo
• Annual: $-11,120/yr
• Cap rate: 3.05%
• Cash-on-cash: -11.59%
• DSCR: 0.48
• 1% rule: 1.11%
• Cash to close: $51,800

Investor read

• This is a 2-bed/1.0-bath condo listed at $185k. Condition is rated good.
• At list price, monthly cash flow is $-927 ($-11k/yr) — negative.
• To cash-flow at today's rent, offer at most $174k (6.0% below list).
• Meets the 1% rule at list price ($2k rent vs $185k).
• It's been on market 127 days — a 12% lower offer ($163k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $163k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#157 in TX, #4,282 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment D, schools F, crime F.
• Watch-outs: flood insurance adds $427/mo; HOA is 41% of rent.
• Market conditions: 254 active listings in the ZIP; 10 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; 2,326 units permitted in Cameron County in 2024 (503 in 5+ unit buildings).
• Cameron County population projected at +3% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 6→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

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 127 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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?