Kendall Plan

Texas City, TX 77568

$321,900D+

4 bd · 2.0 ba · 1,929 sqft · Built — · SingleFamily · Active · 269 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,222/mo
• Mortgage (P&I): −$1,766
• Tax + insurance: −$561
• HOA: −$0
• Vac / Maint / Mgmt: −$677
• Net cashflow: $217/mo
• Annual: $2,606/yr
• Cap rate: 7.07%
• Cash-on-cash: 2.76%
• DSCR: 1.12
• 1% rule: 0.96%
• Cash to close: $94,316

Investor read

• This is a 4-bed/2.0-bath single-family listed at $322k. Condition is rated good.
• At list price, monthly cash flow is $217 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $322k).
• It's been on market 269 days — a 12% lower offer ($283k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $283k (12.0% below list) — sets the bar for market timing.
• 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 62/100 on livability (#907 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: crime D+, amenities F, commute F.
• Dickinson ISD (suburban): math 39% / reading 40% proficiency, ranked #366 of 826 in TX (top 44%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 60% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Hughes Road El (math 36% / reading 31%, grade F, #2,174 of 4,322 statewide, top 51%, 707 students, 67% FRL); Dunbar Middle (math 25% / reading 20%, grade F, #1,341 of 1,662 statewide, top 82%, 654 students, 78% FRL); Dickinson H S (math 30% / reading 46%, grade F, #880 of 1,632 statewide, top 54%, 3,619 students, 64% FRL).
• Market conditions: Rents rising (+4.0%/yr); 661 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals leasing fast (median 14d on market — plan ~1-2 weeks tenant-placement turnaround); 3,258 units permitted in Galveston County in 2024 (0 in 5+ unit buildings).
• Galveston County population projected at +43% 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→26/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.1% vs local median 4.3% in Texas City — 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.
• At $3,222/mo this rent would consume 52% of the median local household income ($75k/yr) (locally 700% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 269 days. Have you received any prior offers? Is the seller open to a 12% 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 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 D 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.
• 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.