2203 Colony Dr

Hondo, TX 78861

$95,900C+

3 bd · 2.0 ba · 1,225 sqft · Built 1980 · SingleFamily · Pending · 65 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,225/mo
• Mortgage (P&I): −$503
• Tax + insurance: −$305
• HOA: −$0
• Vac / Maint / Mgmt: −$257
• Net cashflow: $160/mo
• Annual: $1,923/yr
• Cap rate: 8.30%
• Cash-on-cash: 7.16%
• DSCR: 1.32
• 1% rule: 1.28%
• Cash to close: $26,852

Investor read

• This is a 3-bed/2.0-bath single-family listed at $96k.
• At list price, monthly cash flow is $160 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $96k).
• It's been on market 65 days — a 6% lower offer ($90k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $90k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $663 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#872 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing B+; Watch: amenities F, commute F, health & safety F.
• Hondo ISD (town): math 35% / reading 36% proficiency, ranked #502 of 826 in TX (top 61%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Meyer El (446 students, 84% FRL); Mcdowell Middle (math 37% / reading 34%, grade F, #827 of 1,662 statewide, top 51%, 420 students, 63% FRL); Hondo H S (math 42% / reading 47%, grade F, #652 of 1,632 statewide, top 43%, 522 students, 61% FRL) — zoned schools average 69% FRL vs 27% district-wide (42 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: property tax is 3.3% of price.
• Market conditions: 112 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 102 units permitted in Medina County in 2024 (0 in 5+ unit buildings).
• Medina County population projected at +24% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: major wind risk, 67% 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 8.3% vs local median 2.4% in Hondo — 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

• It's been on market 65 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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?
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.