The Bailey Plan

Seguin, TX 78155

$301,990F

5 bd · 2.0 ba · 1,874 sqft · Built — · SingleFamily · Active · 230 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,146/mo
• Mortgage (P&I): −$1,601
• Tax + insurance: −$509
• HOA: −$0
• Vac / Maint / Mgmt: −$451
• Net cashflow: $-414/mo
• Annual: $-4,970/yr
• Cap rate: 4.66%
• Cash-on-cash: -5.81%
• DSCR: 0.74
• 1% rule: 0.70%
• Cash to close: $85,469

Investor read

• This is a 5-bed/2.0-bath single-family listed at $302k. Condition is rated good.
• At list price, monthly cash flow is $-414 ($-5k/yr) — negative.
• To cash-flow at today's rent, offer at most $245k (18.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $215k (28.9% below list).
• It's been on market 230 days — a 12% lower offer ($266k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $215k (28.9% 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 $9k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#592 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: employment D, amenities F, commute F.
• Navarro ISD (rural): math 48% / reading 50% proficiency, ranked #166 of 826 in TX (top 20%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Navarro El (math 37% / reading 57%, grade D-, #1,006 of 4,322 statewide, top 25%, 702 students, 45% FRL); Navarro Int (math 50% / reading 44%, grade D+, #424 of 1,662 statewide, top 27%, 485 students, 40% FRL); Navarro H S (math 47% / reading 57%, grade D+, #447 of 1,632 statewide, top 29%, 648 students, 33% FRL) — zoned schools at 39% FRL track the district average.
• Market conditions: Rents rising (+2.0%/yr); 1833 active listings in the ZIP; 12 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); 42% of comp listings sitting > 30 days — soft ceiling on asking rent; 2,064 units permitted in Guadalupe County in 2024 (133 in 5+ unit buildings).
• Guadalupe County population projected at +61% 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→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.7% vs local median 3.6% in Seguin — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.
• This rent runs 36% of the median local income ($71k/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?
• It's been on market 230 days. Have you received any prior offers? Is the seller open to a 29% 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?
• 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.