418 N Cedar

Pearsall, TX 78061

$83,357C+

2 bd · 2.0 ba · 832 sqft · Built 1996 · SingleFamily · Pending · 390 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $906/mo
• Mortgage (P&I): −$437
• Tax + insurance: −$207
• HOA: −$0
• Vac / Maint / Mgmt: −$190
• Net cashflow: $72/mo
• Annual: $864/yr
• Cap rate: 7.33%
• Cash-on-cash: 3.70%
• DSCR: 1.16
• 1% rule: 1.09%
• Cash to close: $23,340

Investor read

• This is a 2-bed/2.0-bath single-family listed at $83k.
• At list price, monthly cash flow is $72 ($864/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($906 rent vs $83k).
• It's been on market 390 days — a 12% lower offer ($73k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $73k (12.0% below list) — sets the bar for market timing.
• In year one you build about $5k of equity ($577 loan paydown + $4k appreciation (4.9% local appreciation)).
• Location reads 70/100 on livability (#374 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime B+; Watch: employment C-, schools F, amenities F.
• Pearsall ISD (town): math 12% / reading 19% proficiency, ranked #810 of 826 in TX (top 98%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 76% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: 45 active listings in the ZIP; 12 units permitted in Frio County in 2024 (0 in 5+ unit buildings).
• Frio County population projected at +50% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 13y ago; this cycle's ask has dropped $38k (31%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (4.9% appreciation + 3.0% rent growth), your $23k cash investment doubles in ~4 years — after that, you're playing with house money.
• By year 8, paydown + projected appreciation supports a ~$35k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; major wildfire risk; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 390 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?
• 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.