5122 Sedona Creek Dr

Katy, TX 77493

$325,000D

4 bd · 3.0 ba · 2,534 sqft · Built 2024 · SingleFamily · Active · 10 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,029/mo
• Mortgage (P&I): −$1,704
• Tax + insurance: −$1,230
• HOA: −$121
• Vac / Maint / Mgmt: −$636
• Net cashflow: $-663/mo
• Annual: $-7,955/yr
• Cap rate: 4.09%
• Cash-on-cash: -7.87%
• DSCR: 0.65
• 1% rule: 0.93%
• Cash to close: $91,000

Investor read

• This is a 4-bed/3.0-bath single-family listed at $325k. Condition is rated good.
• At list price, monthly cash flow is $-663 ($-8k/yr) — negative.
• To cash-flow at today's rent, offer at most $247k (24.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $303k (6.8% below list).
• Only 10 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $247k (24.0% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#111 in TX, #3,613 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, cost of living A+, housing A+; Watch: crime C-, amenities D, commute F.
• Katy ISD (suburban): math 61% / reading 63% proficiency, ranked #29 of 826 in TX (top 4%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: property tax is 3.8% of price; flood insurance adds $66/mo.
• Market conditions: Rents soft (-0.8%/yr); 2696 active listings in the ZIP; 24 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 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.
• 3 sale attempts with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Climate carrying-cost: major flood risk; severe wind risk, 99% 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 4.1% vs local median 3.0% in Katy — 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 runs 31% of the median local income ($118k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.