191 Burch Rd

Shepherd, TX 77371

$159,000D

2 bd · 1.0 ba · 1,100 sqft · Built 2006 · SingleFamily · Active · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,311/mo
• Mortgage (P&I): −$834
• Tax + insurance: −$242
• HOA: −$0
• Vac / Maint / Mgmt: −$275
• Net cashflow: $-40/mo
• Annual: $-477/yr
• Cap rate: 5.99%
• Cash-on-cash: -1.07%
• DSCR: 0.95
• 1% rule: 0.82%
• Cash to close: $44,520

Investor read

• This is a 2-bed/1.0-bath single-family listed at $159k.
• At list price, monthly cash flow is $-40 ($-477/yr) — negative.
• To cash-flow at today's rent, offer at most $152k (4.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $131k (17.5% below list).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $131k (17.5% below list) — sets the bar for 1% rule.
• In year one you build about $1k of equity ($1k loan paydown + $263 appreciation (0.2% local appreciation)).
• Location reads 59/100 on livability (#1,112 in TX) — a working-class tenant base; expect higher turnover. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F, employment D-.
• Shepherd ISD (rural): math 20% / reading 22% proficiency, ranked #770 of 826 in TX (top 93%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 64% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Shepherd Pri (499 students, 85% FRL); Shepherd Middle (math 22% / reading 24%, grade F, #1,327 of 1,662 statewide, top 81%, 458 students, 84% FRL); Shepherd H S (math 27% / reading 32%, grade F, #1,112 of 1,632 statewide, top 70%, 601 students, 77% FRL) — zoned schools average 82% FRL vs 64% district-wide (18 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 148 active listings in the ZIP; 575 units permitted in San Jacinto County in 2024 (0 in 5+ unit buildings).
• San Jacinto County population projected at +7% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 7y 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.
• Climate carrying-cost: 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 6.0% vs local median 4.5% in Shepherd — 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?
• 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?
• 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.
• 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.