358 Demolay St

La Marque, TX 77568

$175,000C

None bd · None ba · 5,040 sqft · Built 1950 · MultiFamily · Active · 296 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,969/mo
• Mortgage (P&I): −$918
• Tax + insurance: −$348
• HOA: −$0
• Vac / Maint / Mgmt: −$414
• Net cashflow: $291/mo
• Annual: $3,487/yr
• Cap rate: 8.67%
• Cash-on-cash: 8.48%
• DSCR: 1.38
• 1% rule: 1.13%
• Cash to close: $49,000

Investor read

• This is a multifamily listed at $175k. Condition is rated poor.
• At list price, monthly cash flow is $291 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $175k).
• It's been on market 296 days — a 12% lower offer ($154k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $154k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 59/100 on livability (#1,136 in TX) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A+; Watch: employment D, schools F, crime F.
• Texas City ISD (suburban): math 28% / reading 29% proficiency, ranked #655 of 826 in TX (top 79%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 66% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: flood insurance adds $56/mo; built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+4.0%/yr); 661 active listings in the ZIP; 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.
• 3 sale attempts since 3y ago; this cycle's ask has dropped $25k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: severe flood risk; extreme-heat days projected 7→27/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.7% vs local median 5.6% in La Marque — 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.
• This rent runs 32% of the median local income ($75k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 296 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1950 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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 F 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?

Repairs flagged (vision-AI assessment)

• Major: exterior siding — Severe weathering and graffiti
• Major: roof — General condition suggests potential need for replacement
• Major: flooring — Worn-out and in need of replacement
• Major: interior walls/paint — Peeling paint and general wear
• Major: bathroom fixtures — Missing fixtures and general wear
• Major: systems — General condition suggests potential need for replacement