234 Grayson Elm Pass

Dripping Springs, TX 78620

$449,990D-

5 bd · 4.0 ba · 2,716 sqft · Built 2026 · SingleFamily · Pending · 63 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,328/mo
• Mortgage (P&I): −$2,360
• Tax + insurance: −$750
• HOA: −$50
• Vac / Maint / Mgmt: −$699
• Net cashflow: $-531/mo
• Annual: $-6,367/yr
• Cap rate: 4.88%
• Cash-on-cash: -5.05%
• DSCR: 0.78
• 1% rule: 0.74%
• Cash to close: $125,997

Investor read

• This is a 5-bed/4.0-bath single-family listed at $450k.
• At list price, monthly cash flow is $-531 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $373k (17.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $333k (26.0% below list).
• It's been on market 63 days — a 6% lower offer ($423k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $333k (26.0% 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 $14k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#149 in TX, #4,158 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: cost of living D, amenities F, commute F.
• Dripping Springs ISD (rural): math 55% / reading 61% proficiency, ranked #41 of 826 in TX (top 5%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 16% free/reduced lunch — higher-income household profile.
• Market conditions: Rents rising (+1.8%/yr); 754 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals at typical pace (median 18d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 5,270 units permitted in Hays County in 2024 (1,464 in 5+ unit buildings).
• Hays County population projected at +93% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts; this cycle's ask has dropped $40k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: major wind risk, 65% chance of damaging wind over 30y; moderate wildfire risk; extreme-heat days projected 6→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.9% vs local median 2.2% in Dripping Springs — 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 63 days. Have you received any prior offers? Is the seller open to a 26% concession, seller financing, or rate buy-down credit?
• 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.
• 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.