17518 Majestic Forest Dr

Houston, TX 77379

$289,000D-

4 bd · 2.5 ba · 2,296 sqft · Built 1980 · SingleFamily · Active · 54 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,394/mo
• Mortgage (P&I): −$1,516
• Tax + insurance: −$615
• HOA: −$32
• Vac / Maint / Mgmt: −$503
• Net cashflow: $-271/mo
• Annual: $-3,249/yr
• Cap rate: 5.17%
• Cash-on-cash: -4.02%
• DSCR: 0.82
• 1% rule: 0.83%
• Cash to close: $80,920

Investor read

• This is a 4-bed/2.5-bath single-family listed at $289k.
• At list price, monthly cash flow is $-271 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $241k (16.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $239k (17.1% below list).
• It's been on market 54 days — a 3% lower offer ($280k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $239k (17.1% 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 $9k 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.
• Klein ISD (suburban): math 41% / reading 48% proficiency, ranked #213 of 826 in TX (top 26%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Ehrhardt El (math 27% / reading 34%, grade F, #2,464 of 4,322 statewide, top 58%, 813 students, 65% FRL); Kleb Int (math 40% / reading 53%, grade D+, #443 of 1,662 statewide, top 28%, 1,434 students, 55% FRL); Klein H S (math 58% / reading 67%, grade B-, #234 of 1,632 statewide, top 14%, 3,352 students, 45% FRL) — zoned schools average 55% FRL vs 37% district-wide (18 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents soft (-1.9%/yr); 636 active listings in the ZIP; 9 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• Current owner paid $81k; list at $289k implies a 259% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 6→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.2% 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.

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 54 days. Have you received any prior offers? Is the seller open to a 17% concession, seller financing, or rate buy-down credit?
• 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.