1538 Gardenia Grove Ln

Houston, TX 77532

$257,490D

4 bd · 2.5 ba · 1,968 sqft · Built 2026 · SingleFamily · Pending · 5 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,419/mo
• Mortgage (P&I): −$1,350
• Tax + insurance: −$429
• HOA: −$192
• Vac / Maint / Mgmt: −$508
• Net cashflow: $-60/mo
• Annual: $-723/yr
• Cap rate: 6.01%
• Cash-on-cash: -1.00%
• DSCR: 0.96
• 1% rule: 0.94%
• Cash to close: $72,097

Investor read

• This is a 4-bed/2.5-bath single-family listed at $257k. Condition is rated good.
• At list price, monthly cash flow is $-60 ($-723/yr) — negative.
• To cash-flow at today's rent, offer at most $249k (3.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $242k (6.0% below list).
• Only 5 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $242k (6.0% 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 74/100 on livability (#184 in TX, #4,771 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, cost of living A+, housing A+; Watch: crime F.
• Crosby ISD (rural): math 39% / reading 40% proficiency, ranked #369 of 826 in TX (top 45%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Crosby Middle (math 36% / reading 37%, grade F, #786 of 1,662 statewide, top 48%, 1,549 students, 60% FRL); Crosby H S (math 44% / reading 45%, grade F, #652 of 1,632 statewide, top 43%, 1,937 students, 54% FRL).
• Market conditions: Rents rising (+1.5%/yr); 1189 active listings in the ZIP; 2 comparable units currently listed for rent nearby; solid renter incomes; 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.
• Cap rate 6.0% vs local median 3.2% in Houston — 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 ($92k/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?
• 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• Crime grade is F 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.