10501 South Dr #286

Houston, TX 77099

$75,000D+

2 bd · 1.0 ba · 870 sqft · Built 1980 · Condo · Active · 152 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,162/mo
• Mortgage (P&I): −$393
• Tax + insurance: −$246
• HOA: −$350
• Vac / Maint / Mgmt: −$244
• Net cashflow: $-71/mo
• Annual: $-850/yr
• Cap rate: 6.22%
• Cash-on-cash: -0.25%
• DSCR: 0.99
• 1% rule: 1.55%
• Cash to close: $21,000

Investor read

• This is a 2-bed/1.0-bath condo listed at $75k.
• At list price, monthly cash flow is $-71 ($-850/yr) — negative.
• To cash-flow at today's rent, offer at most $62k (16.7% below list).
• Meets the 1% rule at list price ($1k rent vs $75k).
• It's been on market 152 days — a 12% lower offer ($66k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $62k (16.7% below list) — sets the bar for cash-flow.
• In year one you build about $2k of equity ($519 loan paydown + $2k appreciation (2.6% 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: crime F.
• Alief ISD (urban): math 23% / reading 28% proficiency, ranked #717 of 826 in TX (top 87%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 74% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Smith El (math 25% / reading 25%, grade F, #3,013 of 4,322 statewide, top 70%, 626 students, 93% FRL); Olle Middle (math 16% / reading 32%, grade F, #1,301 of 1,662 statewide, top 79%, 1,067 students, 90% FRL); Alief Isd J J A E P (13 students, 77% FRL).
• Watch-outs: flood insurance adds $66/mo; HOA is 30% of rent.
• Market conditions: Rents soft (-1.7%/yr); 147 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• 5 sale attempts since 10y 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.
• Current owner paid $12k; list at $75k implies a 552% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe flood risk; severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.2% 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 152 days. Have you received any prior offers? Is the seller open to a 17% concession, seller financing, or rate buy-down credit?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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?