603 Blue Ridge Dr

Shenandoah, TX 77381

$325,000D

4 bd · 2.0 ba · 2,140 sqft · Built 1972 · SingleFamily · Active · 112 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,584/mo
• Mortgage (P&I): −$1,704
• Tax + insurance: −$475
• HOA: −$0
• Vac / Maint / Mgmt: −$543
• Net cashflow: $-138/mo
• Annual: $-1,654/yr
• Cap rate: 5.78%
• Cash-on-cash: -1.82%
• DSCR: 0.92
• 1% rule: 0.80%
• Cash to close: $91,000

Investor read

• This is a 4-bed/2.0-bath single-family listed at $325k.
• At list price, monthly cash flow is $-138 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $301k (7.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $258k (20.5% below list).
• It's been on market 112 days — a 9% lower offer ($296k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $258k (20.5% 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 $10k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#193 in TX, #4,918 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, health & safety A-; Watch: amenities D+, crime F, commute F.
• Conroe ISD (other): math 57% / reading 57% proficiency, ranked #69 of 826 in TX (top 8%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Lamar El (math 49% / reading 54%, grade C-, #808 of 4,322 statewide, top 19%, 718 students, 51% FRL); Knox J H (math 65% / reading 67%, grade A-, #92 of 1,662 statewide, top 6%, 1,448 students, 31% FRL); Conroe H S (math 32% / reading 51%, grade F, #767 of 1,632 statewide, top 47%, 4,915 students, 61% FRL).
• Market conditions: Rents rising (+2.1%/yr); 261 active listings in the ZIP; 18 comparable units currently listed for rent nearby; rentals leasing fast (median 12d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 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.
• 5 sale attempts since 16y ago; this cycle's ask is 30% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $101k; list at $325k implies a 222% 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 7→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.8% vs local median 2.6% in Shenandoah — 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 112 days. Have you received any prior offers? Is the seller open to a 20% concession, seller financing, or rate buy-down credit?
• Built in 1972 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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 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?