12774 Market St Rd

Houston, TX 77015

$379,900D

1 bd · 1.0 ba · 3,590 sqft · Built 1960 · MultiFamily · Active · 129 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,036/mo
• Mortgage (P&I): −$1,992
• Tax + insurance: −$633
• HOA: −$0
• Vac / Maint / Mgmt: −$638
• Net cashflow: $-227/mo
• Annual: $-2,724/yr
• Cap rate: 5.58%
• Cash-on-cash: -2.56%
• DSCR: 0.89
• 1% rule: 0.80%
• Cash to close: $106,372

Investor read

• This is a 1-bed/1.0-bath multifamily listed at $380k. Condition is rated fair.
• At list price, monthly cash flow is $-227 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $347k (8.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $304k (20.1% below list).
• It's been on market 129 days — a 12% lower offer ($334k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $304k (20.1% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $11k of value loss. Plan a longer hold.
• 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.
• Galena Park ISD (suburban): math 32% / reading 33% proficiency, ranked #578 of 826 in TX (top 70%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 74% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Woodland Acres El (math 30% / reading 39%, grade F, #1,995 of 4,322 statewide, top 50%, 443 students, 85% FRL); Woodland Acres Middle (math 35% / reading 34%, grade F, #858 of 1,662 statewide, top 54%, 603 students, 85% FRL); Galena Park H S (math 37% / reading 36%, grade F, #924 of 1,632 statewide, top 57%, 1,914 students, 87% FRL).
• Market conditions: Rents soft (-0.8%/yr); 164 active listings in the ZIP; 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.
• Cap rate 5.6% vs local median 3.1% 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.
• At $3,036/mo this rent would consume 63% of the median local household income ($58k/yr) (locally 1816% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 129 days. Have you received any prior offers? Is the seller open to a 20% 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 1960 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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: Appliances — Outdated and need replacement
• Major: Flooring — Worn and uneven
• Major: Paint — Chipped and uneven
• Major: HVAC/mechanicals — No visible photos, but likely outdated