8702 Parkway Forest Dr

Houston, TX 77044

$145,000C

3 bd · 2.0 ba · 1,401 sqft · Built 1979 · SingleFamily · Pending · 8 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,600/mo
• Mortgage (P&I): −$760
• Tax + insurance: −$516
• HOA: −$0
• Vac / Maint / Mgmt: −$336
• Net cashflow: $-12/mo
• Annual: $-150/yr
• Cap rate: 6.74%
• Cash-on-cash: 1.59%
• DSCR: 1.07
• 1% rule: 1.10%
• Cash to close: $40,600

Investor read

• This is a 3-bed/2.0-bath single-family listed at $145k.
• At list price, monthly cash flow is $-12 ($-150/yr) — negative.
• To cash-flow at today's rent, offer at most $143k (1.5% below list).
• Meets the 1% rule at list price ($2k rent vs $145k).
• Only 8 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $143k (1.5% below list) — sets the bar for cash-flow.
• Local home prices are declining (-1.6%/yr); year-one equity from $1k of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• 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.
• Sheldon ISD (suburban): math 19% / reading 25% proficiency, ranked #746 of 826 in TX (top 90%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 72% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: C E King Middle (math 13% / reading 24%, grade F, #1,478 of 1,662 statewide, top 90%, 1,311 students, 90% FRL) — zoned schools average 90% FRL vs 72% district-wide (18 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: property tax is 3.2% of price; flood insurance adds $66/mo.
• Market conditions: Rents flat; 340 active listings in the ZIP; 16 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); 44% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 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.
• 2 sale attempts since 24y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $30k; list at $145k implies a 385% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major 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 6.7% 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?
• Built in 1979 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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?
• 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.