7930 Ritz St #16

Houston, TX 77028

$485,000B+

1 bd · 1.0 ba · 4,447 sqft · Built 1975 · MultiFamily · Active · 366 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $16,899/mo
• Mortgage (P&I): −$2,543
• Tax + insurance: −$808
• HOA: −$0
• Vac / Maint / Mgmt: −$3,549
• Net cashflow: $9,998/mo
• Annual: $119,982/yr
• Cap rate: 31.03%
• Cash-on-cash: 88.35%
• DSCR: 4.93
• 1% rule: 3.48%
• Cash to close: $135,800

Investor read

• This is a 1-bed/1.0-bath multifamily listed at $485k. Condition is rated poor.
• At list price, monthly cash flow is $10k ($120k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($17k rent vs $485k).
• It's been on market 366 days — a 12% lower offer ($427k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $427k (12.0% below list) — sets the bar for market timing.
• In year one you build about $29k of equity ($3k loan paydown + $25k appreciation (5.2% local appreciation)).
• 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.
• Houston ISD (urban): math 27% / reading 35% proficiency, ranked #593 of 826 in TX (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 71% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents soft (-1.6%/yr); 353 active listings in the ZIP; lower-income renter base — watch delinquency; 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.
• 6 sale attempts since 3y ago; this cycle's ask has dropped $65k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (5.2% appreciation + 0.0% rent growth), your $136k cash investment doubles in ~1 year — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$46k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: severe wind risk, 99% 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 31.0% 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.
• At $16,899/mo this rent would consume 529% of the median local household income ($38k/yr) (locally 1177% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 366 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1975 — 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.

Repairs flagged (vision-AI assessment)

• Major: Roof — Sections of the roof are missing
• Major: Flooring — Damaged and uneven
• Major: Interior walls/paint — Paint peeling and walls damaged
• Major: Bathroom fixtures — Old and worn
• Major: HVAC/mechanicals — No visible signs of functioning systems