Magnolia Plan

Weslaco, TX 78599

$327,990D-

5 bd · 3.5 ba · 3,037 sqft · Built — · SingleFamily · Active · 887 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,879/mo
• Mortgage (P&I): −$1,884
• Tax + insurance: −$599
• HOA: −$25
• Vac / Maint / Mgmt: −$605
• Net cashflow: $-234/mo
• Annual: $-2,803/yr
• Cap rate: 5.51%
• Cash-on-cash: -2.79%
• DSCR: 0.88
• 1% rule: 0.80%
• Cash to close: $100,611

Investor read

• This is a 5-bed/3.5-bath single-family listed at $328k. Condition is rated excellent.
• At list price, monthly cash flow is $-234 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $326k (0.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $288k (12.2% below list).
• It's been on market 887 days — a 12% lower offer ($289k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $288k (12.2% 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 $11k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#277 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment D+, crime F, amenities F.
• Weslaco ISD (suburban): math 23% / reading 31% proficiency, ranked #705 of 826 in TX (top 85%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: North Bridge El (math 8% / reading 17%, grade F, #4,180 of 4,322 statewide, top 97%, 692 students, 92% FRL); Central Middle (math 33% / reading 40%, grade F, #786 of 1,662 statewide, top 48%, 974 students, 70% FRL); Weslaco H S (math 25% / reading 33%, grade F, #1,147 of 1,632 statewide, top 71%, 2,553 students, 73% FRL) — zoned schools average 79% FRL vs 59% district-wide (19 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 349 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals lingering (median 110d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 7,378 units permitted in Hidalgo County in 2024 (641 in 5+ unit buildings).
• Hidalgo County population projected at +28% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Cap rate 5.5% vs local median 4.0% in Weslaco — 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.
• At $2,879/mo this rent would consume 62% of the median local household income ($56k/yr) — very limited rent-growth headroom before tenants either downsize or default.

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 887 days. Have you received any prior offers? Is the seller open to a 12% 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?
• 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.
• 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.