713 Ver-lo Dr

Lorena, TX 76655

$319,900D-

4 bd · 2.0 ba · 1,743 sqft · Built 2006 · SingleFamily · Pending · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,799/mo
• Mortgage (P&I): −$1,678
• Tax + insurance: −$643
• HOA: −$0
• Vac / Maint / Mgmt: −$588
• Net cashflow: $-110/mo
• Annual: $-1,314/yr
• Cap rate: 5.88%
• Cash-on-cash: -1.47%
• DSCR: 0.93
• 1% rule: 0.87%
• Cash to close: $89,572

Investor read

• This is a 4-bed/2.0-bath single-family listed at $320k.
• At list price, monthly cash flow is $-110 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $301k (6.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $280k (12.5% below list).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $280k (12.5% 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 $10k of value loss. Plan a longer hold.
• Location reads 71/100 on livability (#325 in TX) — a middle-class / working-renter tenant base. Strengths: employment A+, cost of living A+, housing A+; Watch: amenities F, commute F, health & safety F.
• Lorena ISD (rural): math 57% / reading 63% proficiency, ranked #46 of 826 in TX (top 6%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 16% free/reduced lunch — higher-income household profile.
• Zoned schools: Lorena El (math 60% / reading 60%, grade B-, #398 of 4,322 statewide, top 9%, 415 students, 31% FRL) — zoned schools average 31% FRL vs 16% district-wide (15 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 265 active listings in the ZIP; 2 comparable units currently listed for rent nearby; solid renter incomes; 1,014 units permitted in McLennan County in 2024 (200 in 5+ unit buildings).
• McLennan County population projected at +17% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→25/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.9% vs local median 2.9% in Lorena — 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 34% of the median local income ($100k/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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.