23684 Fm 227 E

Kennard, TX 75847

$57,000B

2 bd · 1.0 ba · 608 sqft · Built 1962 · SingleFamily · Pending · 100 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $892/mo
• Mortgage (P&I): −$299
• Tax + insurance: −$86
• HOA: −$0
• Vac / Maint / Mgmt: −$187
• Net cashflow: $320/mo
• Annual: $3,838/yr
• Cap rate: 13.03%
• Cash-on-cash: 24.05%
• DSCR: 2.07
• 1% rule: 1.57%
• Cash to close: $15,960

Investor read

• This is a 2-bed/1.0-bath single-family listed at $57k.
• At list price, monthly cash flow is $320 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($892 rent vs $57k).
• It's been on market 100 days — a 9% lower offer ($52k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $52k (9.0% below list) — sets the bar for market timing.
• In year one you build about $1k of equity ($394 loan paydown + $652 appreciation (1.1% local appreciation)).
• Location reads 60/100 on livability (#1,083 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: crime F, amenities F, commute F.
• Kennard ISD (rural): math 45% / reading 40% proficiency, ranked #670 of 1,141 in TX (top 59%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 63% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Kennard Isd (math 37% / reading 37%, 258 students, 67% FRL) — zoned schools at 67% FRL track the district average.
• Market conditions: 40 active listings in the ZIP; 3 units permitted in Houston County in 2024 (0 in 5+ unit buildings).
• Houston County population projected at -16% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• At projected returns (1.1% appreciation + 3.0% rent growth), your $16k cash investment doubles in ~4 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→25/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 100 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1962 — 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?
• 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.