918 Martin Luther King Dr

Huntsville, TX 77320

$193,500D-

3 bd · 2.0 ba · 2,151 sqft · Built 1960 · SingleFamily · Active · 512 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,402/mo
• Mortgage (P&I): −$1,015
• Tax + insurance: −$292
• HOA: −$0
• Vac / Maint / Mgmt: −$294
• Net cashflow: $-200/mo
• Annual: $-2,396/yr
• Cap rate: 5.05%
• Cash-on-cash: -4.42%
• DSCR: 0.80
• 1% rule: 0.72%
• Cash to close: $54,180

Investor read

• This is a 3-bed/2.0-bath single-family listed at $194k.
• At list price, monthly cash flow is $-200 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $158k (18.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $140k (27.6% below list).
• It's been on market 512 days — a 12% lower offer ($170k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $140k (27.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#825 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+; Watch: amenities C-, schools D-, crime D-.
• Huntsville ISD (town): math 25% / reading 37% proficiency, ranked #621 of 826 in TX (top 75%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising (+2.9%/yr); 518 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 527 units permitted in Walker County in 2024 (0 in 5+ unit buildings).
• Walker County population projected at +29% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 5 sale attempts since 3y ago; this cycle's ask has dropped $12k (6%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: severe wind risk, 98% 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 5.1% vs local median 2.6% in Huntsville — 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 30% of the median local income ($56k/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?
• It's been on market 512 days. Have you received any prior offers? Is the seller open to a 28% concession, seller financing, or rate buy-down credit?
• Built in 1960 — 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 D 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?