Pierce Plan

Conroe, TX 77378

$220,990D

4 bd · 2.5 ba · 1,619 sqft · Built — · SingleFamily · Active · 687 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,082/mo
• Mortgage (P&I): −$1,278
• Tax + insurance: −$406
• HOA: −$0
• Vac / Maint / Mgmt: −$437
• Net cashflow: $-40/mo
• Annual: $-480/yr
• Cap rate: 6.10%
• Cash-on-cash: -0.70%
• DSCR: 0.97
• 1% rule: 0.85%
• Cash to close: $68,245

Investor read

• This is a 4-bed/2.5-bath single-family listed at $221k. Condition is rated good.
• At list price, monthly cash flow is $-40 ($-480/yr) — negative.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $208k (5.8% below list).
• It's been on market 687 days — a 12% lower offer ($194k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $194k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#169 in TX, #4,447 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, amenities B; Watch: schools D+, commute F, health & safety F.
• Willis ISD (rural): math 33% / reading 40% proficiency, ranked #458 of 826 in TX (top 55%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents flat; 710 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 13,259 units permitted in Montgomery County in 2024 (1,402 in 5+ unit buildings).
• Montgomery County population projected at +65% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Cap rate 6.1% vs local median 3.1% in Conroe — 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.
• This rent runs 35% of the median local income ($71k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 687 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• 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 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?
• 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.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.