12500 Melville Dr Unit 231 C

Conroe, TX 77356

$140,000D-

1 bd · 1.0 ba · 692 sqft · Built 1977 · Condo · Active · 75 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,240/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$233
• HOA: −$250
• Vac / Maint / Mgmt: −$260
• Net cashflow: $-238/mo
• Annual: $-2,858/yr
• Cap rate: 4.25%
• Cash-on-cash: -7.29%
• DSCR: 0.68
• 1% rule: 0.89%
• Cash to close: $39,200

Investor read

• This is a 1-bed/1.0-bath condo listed at $140k.
• At list price, monthly cash flow is $-238 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $106k (24.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $124k (11.5% below list).
• It's been on market 75 days — a 6% lower offer ($132k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $106k (24.6% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $968 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#169 in TX, #4,447 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, amenities B; Watch: schools D+, commute F, health & safety F.
• Montgomery ISD (rural): math 63% / reading 57% proficiency, ranked #49 of 826 in TX (top 6%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: HOA is 20% of rent.
• Market conditions: Rents falling (-3.3%/yr); 1056 active listings in the ZIP; 1 comparable units currently listed for rent nearby; solid renter incomes; 13,259 units permitted in Montgomery County in 2024 (1,402 in 5+ unit buildings).
• Montgomery County population projected at +65% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 15y ago; this cycle's ask is 12074% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Climate carrying-cost: 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 4.3% vs local median 3.1% in Conroe — 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 is only 14% of the median local income ($107k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

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 75 days. Have you received any prior offers? Is the seller open to a 25% concession, seller financing, or rate buy-down credit?
• Built in 1977 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?