5235 Palo Verde Dr

Iowa Colony, TX 77583

$325,000D

3 bd · 2.5 ba · 1,838 sqft · Built 2026 · SingleFamily · Active · 19 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,266/mo
• Mortgage (P&I): −$1,704
• Tax + insurance: −$968
• HOA: −$0
• Vac / Maint / Mgmt: −$476
• Net cashflow: $-882/mo
• Annual: $-10,586/yr
• Cap rate: 4.61%
• Cash-on-cash: -6.01%
• DSCR: 0.73
• 1% rule: 0.70%
• Cash to close: $91,000

Investor read

• This is a 3-bed/2.5-bath single-family listed at $325k. Condition is rated excellent.
• At list price, monthly cash flow is $-882 ($-11k/yr) — negative.
• To cash-flow at today's rent, offer at most $197k (39.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $227k (30.3% below list).
• It's been on market 19 days — a 2% lower offer ($320k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $197k (39.3% below list) — sets the bar for cash-flow.
• 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 64/100 on livability (#757 in TX) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, cost of living A+; Watch: schools F, amenities F, commute F.
• Alvin ISD (suburban): math 39% / reading 48% proficiency, ranked #255 of 826 in TX (top 31%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: flood insurance adds $427/mo.
• Market conditions: Rents flat; 1917 active listings in the ZIP; high-income renter base; 3,960 units permitted in Brazoria County in 2024 (593 in 5+ unit buildings).
• Brazoria County population projected at +44% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); 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.

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?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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.
• 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.