The 1262 Plan

Temple, TX 76502

$245,900F

3 bd · 2.0 ba · 1,262 sqft · Built — · SingleFamily · Active · 162 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,842/mo
• Mortgage (P&I): −$1,378
• Tax + insurance: −$438
• HOA: −$0
• Vac / Maint / Mgmt: −$387
• Net cashflow: $-360/mo
• Annual: $-4,325/yr
• Cap rate: 4.65%
• Cash-on-cash: -5.88%
• DSCR: 0.74
• 1% rule: 0.70%
• Cash to close: $73,574

Investor read

• This is a 3-bed/2.0-bath single-family listed at $246k. Condition is rated good.
• At list price, monthly cash flow is $-360 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $211k (14.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $184k (25.1% below list).
• It's been on market 162 days — a 12% lower offer ($216k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $184k (25.1% 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 $8k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#122 in TX, #3,814 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: commute C-, crime D+, employment D+.
• Academy ISD (rural): math 40% / reading 43% proficiency, ranked #309 of 826 in TX (top 37%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Academy El (math 42% / reading 37%, grade F, #1,545 of 4,322 statewide, top 38%, 704 students, 44% FRL); Academy J H (math 46% / reading 47%, grade D+, #443 of 1,662 statewide, top 28%, 419 students, 46% FRL); Academy H S (math 17% / reading 52%, grade F, #963 of 1,632 statewide, top 61%, 530 students, 34% FRL).
• Market conditions: Rents soft (-0.8%/yr); 1312 active listings in the ZIP; 1 comparable units currently listed for rent nearby; solid renter incomes; 3,222 units permitted in Bell County in 2024 (246 in 5+ unit buildings).
• Bell County population projected at +21% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: severe wind risk, 80% chance of damaging wind over 30y; extreme-heat days projected 7→25/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.6% vs local median 3.6% in Temple — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

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 162 days. Have you received any prior offers? Is the seller open to a 25% 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.
• Crime grade is D in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.