540 Broken Arrow Lane Plan

Kyle, TX 78640

$109,995B

3 bd · 2.0 ba · 1,560 sqft · Built — · Manufactured · Active · 16 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,837/mo
• Mortgage (P&I): −$577
• Tax + insurance: −$183
• HOA: −$0
• Vac / Maint / Mgmt: −$386
• Net cashflow: $691/mo
• Annual: $8,297/yr
• Cap rate: 13.84%
• Cash-on-cash: 26.94%
• DSCR: 2.20
• 1% rule: 1.67%
• Cash to close: $30,799

Investor read

• This is a 3-bed/2.0-bath manufactured listed at $110k. Condition is rated good.
• At list price, monthly cash flow is $691 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $110k).
• It's been on market 16 days — a 2% lower offer ($108k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $108k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $760 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#138 in TX, #3,993 nationally) — a middle-class / working-renter tenant base. Strengths: housing A+, health & safety A+, employment A; Watch: schools D, amenities F, commute F.
• Hays CISD (rural): math 35% / reading 41% proficiency, ranked #390 of 826 in TX (top 47%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents soft (-0.3%/yr); 1819 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 5,270 units permitted in Hays County in 2024 (1,464 in 5+ unit buildings).
• Hays County population projected at +93% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• At projected returns (-3.0% appreciation + 0.0% rent growth), your $31k cash investment doubles in ~6 years — after that, you're playing with house money.
• Climate carrying-cost: severe wind risk, 80% 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 13.8% vs local median 3.3% in Kyle — 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

• 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?
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.