202 Mcphail St

Houston, TX 77375

$150,000F

1 bd · 1.0 ba · 1,080 sqft · Built 1950 · SingleFamily · Pending

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,298/mo
• Mortgage (P&I): −$787
• Tax + insurance: −$402
• HOA: −$0
• Vac / Maint / Mgmt: −$273
• Net cashflow: $-163/mo
• Annual: $-1,954/yr
• Cap rate: 4.99%
• Cash-on-cash: -4.65%
• DSCR: 0.79
• 1% rule: 0.87%
• Cash to close: $42,000

Investor read

• This is a 1-bed/1.0-bath single-family listed at $150k.
• At list price, monthly cash flow is $-163 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $121k (19.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $130k (13.5% below list).
• Only 0 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $121k (19.2% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $4k 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.
• Klein ISD (suburban): math 41% / reading 48% proficiency, ranked #213 of 826 in TX (top 26%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Klein Oak H S (math 47% / reading 60%, grade C-, #428 of 1,632 statewide, top 27%, 3,621 students, 38% FRL) — zoned schools at 38% FRL track the district average.
• Watch-outs: property tax is 2.7% of price; built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents soft (-0.5%/yr); 666 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 4d on market — plan ~1-2 weeks tenant-placement turnaround); 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.
• Cap rate 5.0% 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.
• This rent is only 15% of the median local income ($102k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

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 1950 — 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?
• 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?
• 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.