423 Masterson St

Arcola, TX 77583

$249,900C-

3 bd · 2.0 ba · 2,149 sqft · Built 1997 · SingleFamily · Pending · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,498/mo
• Mortgage (P&I): −$1,311
• Tax + insurance: −$637
• HOA: −$0
• Vac / Maint / Mgmt: −$524
• Net cashflow: $25/mo
• Annual: $302/yr
• Cap rate: 6.41%
• Cash-on-cash: 0.43%
• DSCR: 1.02
• 1% rule: 1.00%
• Cash to close: $69,972

Investor read

• This is a 3-bed/2.0-bath single-family listed at $250k.
• At list price, monthly cash flow is $25 ($302/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $250k (0.1% below list).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $250k (0.1% 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 $7k of value loss. Plan a longer hold.
• Location reads 53/100 on livability (#1,425 in TX) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A; Watch: employment C-, crime F, amenities F.
• Fort Bend ISD (suburban): math 44% / reading 53% proficiency, ranked #140 of 826 in TX (top 17%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Heritage Rose El (math 29% / reading 28%, grade F, #2,706 of 4,322 statewide, top 63%, 1,209 students, 83% FRL); Ronald Thornton Middle (math 40% / reading 52%, grade D+, #462 of 1,662 statewide, top 28%, 1,529 students, 41% FRL) — zoned schools average 62% FRL vs 35% district-wide (27 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: property tax is 2.6% of price.
• Market conditions: Rents flat; 1147 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 83% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 12,093 units permitted in Fort Bend County in 2024 (815 in 5+ unit buildings).
• Fort Bend County population projected at +75% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.4% vs local median 5.0% in Arcola — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

Questions for listing agent

• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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?
• 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.
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.