5724 Cavalcade St

Houston, TX 77026

$130,000D-

1 bd · 0.5 ba · 2,320 sqft · Built 2003 · SingleFamily · Active · 253 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $941/mo
• Mortgage (P&I): −$682
• Tax + insurance: −$217
• HOA: −$0
• Vac / Maint / Mgmt: −$198
• Net cashflow: $-155/mo
• Annual: $-1,857/yr
• Cap rate: 4.86%
• Cash-on-cash: -5.10%
• DSCR: 0.77
• 1% rule: 0.72%
• Cash to close: $36,400

Investor read

• This is a 1-bed/0.5-bath single-family listed at $130k.
• At list price, monthly cash flow is $-155 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $108k (17.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $94k (27.6% below list).
• It's been on market 253 days — a 12% lower offer ($114k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $94k (27.6% below list) — sets the bar for 1% rule.
• In year one you build about $6k of equity ($899 loan paydown + $5k appreciation (3.9% local appreciation)).
• 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: schools D, crime F.
• Houston ISD (urban): math 27% / reading 35% proficiency, ranked #593 of 826 in TX (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 71% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising (+3.1%/yr); 445 active listings in the ZIP; 1 comparable units currently listed for rent nearby; lower-income renter base — watch delinquency; 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.
• 12 sale attempts since 9y 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.
• By year 6, paydown + projected appreciation supports a ~$32k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 4.9% 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?
• It's been on market 253 days. Have you received any prior offers? Is the seller open to a 28% 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?
• 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.