20202 River Ridge Dr

Porter, TX 77365

$240,000D

3 bd · 2.0 ba · 1,800 sqft · Built 1981 · SingleFamily · Active · 172 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,949/mo
• Mortgage (P&I): −$1,259
• Tax + insurance: −$827
• HOA: −$0
• Vac / Maint / Mgmt: −$409
• Net cashflow: $-545/mo
• Annual: $-6,544/yr
• Cap rate: 5.70%
• Cash-on-cash: -2.12%
• DSCR: 0.91
• 1% rule: 0.81%
• Cash to close: $67,200

Investor read

• This is a 3-bed/2.0-bath single-family listed at $240k. Condition is rated good.
• At list price, monthly cash flow is $-545 ($-7k/yr) — negative.
• To cash-flow at today's rent, offer at most $161k (32.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $195k (18.8% below list).
• It's been on market 172 days — a 12% lower offer ($211k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $161k (32.9% 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 $7k of value loss. Plan a longer hold.
• Location reads: area grade D — affects rentability + tenant quality, not the cash-flow math above.
• New Caney ISD (suburban): math 31% / reading 32% proficiency, ranked #570 of 826 in TX (top 69%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: New Caney H S (math 24% / reading 31%, grade F, #1,183 of 1,632 statewide, top 73%, 2,428 students, 78% FRL) — zoned schools average 78% FRL vs 57% district-wide (21 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: flood insurance adds $427/mo.
• Market conditions: Rents rising (+1.6%/yr); 1363 active listings in the ZIP; 37 comparable units currently listed for rent nearby; rentals lingering (median 70d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 65% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); 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 5.7% vs local median 2.5% in Porter — 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 172 days. Have you received any prior offers? Is the seller open to a 33% concession, seller financing, or rate buy-down credit?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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.