Rio Grande Plan

Todd Mission, TX 77316

$285,990F

4 bd · 2.5 ba · 2,507 sqft · Built — · SingleFamily · Active · 446 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,343/mo
• Mortgage (P&I): −$1,605
• Tax + insurance: −$510
• HOA: −$0
• Vac / Maint / Mgmt: −$492
• Net cashflow: $-263/mo
• Annual: $-3,159/yr
• Cap rate: 5.26%
• Cash-on-cash: -3.69%
• DSCR: 0.84
• 1% rule: 0.77%
• Cash to close: $85,676

Investor read

• This is a 4-bed/2.5-bath single-family listed at $286k.
• At list price, monthly cash flow is $-263 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $268k (6.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $234k (18.1% below list).
• It's been on market 446 days — a 12% lower offer ($252k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $234k (18.1% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $9k of value loss. Plan a longer hold.
• Location reads 67/100 on livability (#549 in TX) — a middle-class / working-renter tenant base. Strengths: employment A+, cost of living A+, housing A+; Watch: schools F, amenities F, commute F.
• Magnolia ISD (rural): math 42% / reading 45% proficiency, ranked #247 of 826 in TX (top 30%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents flat; 2300 active listings in the ZIP; high-income renter base; 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.
• Climate carrying-cost: severe wind risk, 98% chance of damaging wind over 30y; extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.3% vs local median 2.9% in Todd Mission — 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.

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 446 days. Have you received any prior offers? Is the seller open to a 18% concession, seller financing, or rate buy-down credit?
• 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?
• 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.