20423 Moon Walk Dr

Houston, TX 77338

$220,000C-

4 bd · 3.5 ba · 2,784 sqft · Built 2014 · SingleFamily · Pending · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,351/mo
• Mortgage (P&I): −$1,154
• Tax + insurance: −$746
• HOA: −$29
• Vac / Maint / Mgmt: −$494
• Net cashflow: $-72/mo
• Annual: $-861/yr
• Cap rate: 5.90%
• Cash-on-cash: -1.40%
• DSCR: 0.94
• 1% rule: 1.07%
• Cash to close: $61,600

Investor read

• This is a 4-bed/3.5-bath single-family listed at $220k.
• At list price, monthly cash flow is $-72 ($-861/yr) — negative.
• To cash-flow at today's rent, offer at most $207k (5.8% below list).
• Meets the 1% rule at list price ($2k rent vs $220k).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $207k (5.8% below list) — sets the bar for cash-flow.
• Local home prices are declining (-0.8%/yr); year-one equity from $2k of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#184 in TX, #4,771 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, cost of living A+, housing A+; Watch: schools D, crime F.
• Aldine ISD (suburban): math 16% / reading 21% proficiency, ranked #790 of 826 in TX (top 96%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 79% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: property tax is 3.6% of price.
• Market conditions: Rents rising (+2.2%/yr); 311 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 29,883 units permitted in Harris County in 2024 (8,621 in 5+ unit buildings).
• Harris County population projected at +47% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Climate carrying-cost: major flood risk; severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→26/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.9% vs local median 3.2% in Houston — 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 44% of the median local income ($65k/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?
• 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?
• 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.