56 Road 5102c

Cleveland, TX 77327

$188,160C

4 bd · 3.0 ba · 1,720 sqft · Built 2022 · SingleFamily · Active · 98 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,034/mo
• Mortgage (P&I): −$987
• Tax + insurance: −$474
• HOA: −$12
• Vac / Maint / Mgmt: −$427
• Net cashflow: $134/mo
• Annual: $1,607/yr
• Cap rate: 7.15%
• Cash-on-cash: 3.05%
• DSCR: 1.14
• 1% rule: 1.08%
• Cash to close: $52,685

Investor read

• This is a 4-bed/3.0-bath single-family listed at $188k. Condition is rated good.
• At list price, monthly cash flow is $134 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $188k).
• It's been on market 98 days — a 9% lower offer ($171k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $171k (9.0% below list) — sets the bar for market timing.
• 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 61/100 on livability (#1,013 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: crime D-, amenities F, commute F.
• Cleveland ISD (town): math 24% / reading 25% proficiency, ranked #723 of 826 in TX (top 88%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 71% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Cottonwood El (math 25% / reading 18%, grade F, #3,470 of 4,322 statewide, top 81%, 827 students, 97% FRL); Santa Fe Middle (915 students, 99% FRL); Cleveland H S (math 30% / reading 32%, grade F, #1,077 of 1,632 statewide, top 66%, 3,310 students, 92% FRL) — zoned schools average 96% FRL vs 71% district-wide (25 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: property tax is 2.5% of price.
• Market conditions: Rents rising fast (+4.0%/yr); 1804 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals lingering (median 72d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 67% of comp listings sitting > 30 days — soft ceiling on asking rent; 1,321 units permitted in Liberty County in 2024 (0 in 5+ unit buildings).
• Liberty County population projected at +24% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts; this cycle's ask has dropped $36k (16%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; moderate wildfire risk; extreme-heat days projected 7→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.1% vs local median 5.0% in Cleveland — 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 39% of the median local income ($62k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 98 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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.
• Schools are F-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?
• 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.