12500 Melville Dr Unit 228C

Conroe, TX 77356

$140,400D

1 bd · 1.0 ba · 692 sqft · Built 1977 · SingleFamily · Active · 272 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,239/mo
• Mortgage (P&I): −$736
• Tax + insurance: −$234
• HOA: −$205
• Vac / Maint / Mgmt: −$260
• Net cashflow: $-196/mo
• Annual: $-2,353/yr
• Cap rate: 4.62%
• Cash-on-cash: -5.99%
• DSCR: 0.73
• 1% rule: 0.88%
• Cash to close: $39,312

Investor read

• This is a 1-bed/1.0-bath single-family listed at $140k. Condition is rated good.
• At list price, monthly cash flow is $-196 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $112k (20.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $124k (11.7% below list).
• It's been on market 272 days — a 12% lower offer ($124k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $112k (20.2% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $971 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: 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.
• Zoned schools: Madeley Ranch El (math 59% / reading 55%, grade C+, #505 of 4,322 statewide, top 13%, 786 students, 26% FRL); Montgomery J H (math 68% / reading 54%, grade B+, #145 of 1,662 statewide, top 9%, 1,045 students, 30% FRL); Montgomery H S (math 53% / reading 62%, grade C, #327 of 1,632 statewide, top 20%, 1,556 students, 25% FRL) — zoned schools at 27% FRL track the district average.
• Market conditions: Rents falling (-3.3%/yr); 1069 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.
• 3 sale attempts since 2y ago; this cycle's ask is 10999% 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 4.6% 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 272 days. Have you received any prior offers? Is the seller open to a 20% 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?
• 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?
• 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?