438 Dubai Ave

San Marcos, TX 78656

$236,999D+

4 bd · 2.5 ba · 1,867 sqft · Built 2026 · SingleFamily · Active · 15 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,032/mo
• Mortgage (P&I): −$1,243
• Tax + insurance: −$395
• HOA: −$0
• Vac / Maint / Mgmt: −$427
• Net cashflow: $-33/mo
• Annual: $-391/yr
• Cap rate: 6.13%
• Cash-on-cash: -0.59%
• DSCR: 0.97
• 1% rule: 0.86%
• Cash to close: $66,360

Investor read

• This is a 4-bed/2.5-bath single-family listed at $237k. Condition is rated good.
• At list price, monthly cash flow is $-33 ($-391/yr) — negative.
• To cash-flow at today's rent, offer at most $232k (2.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $203k (14.3% below list).
• It's been on market 15 days — a 2% lower offer ($233k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $203k (14.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-1.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $2k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#30 in TX, #1,601 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, cost of living A+, health & safety A+; Watch: crime D+, employment F.
• Lockhart ISD (town): math 27% / reading 29% proficiency, ranked #657 of 826 in TX (top 80%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 62% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Navarro El (math 27% / reading 30%, grade F, #2,706 of 4,322 statewide, top 63%, 580 students, 72% FRL); Lockhart J H (math 22% / reading 26%, grade F, #1,301 of 1,662 statewide, top 79%, 1,433 students, 74% FRL); Lockhart H S (math 21% / reading 33%, grade F, #1,204 of 1,632 statewide, top 75%, 1,968 students, 69% FRL).
• Market conditions: Rents falling (-5.4%/yr); 325 active listings in the ZIP; 39 comparable units currently listed for rent nearby; rentals at typical pace (median 20d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 529 units permitted in Caldwell County in 2024 (6 in 5+ unit buildings).
• Caldwell County population projected at +33% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Cap rate 6.1% vs local median 3.2% in San Marcos — 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.

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?
• 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?
• 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.
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.