1219 Saint Michael St

Gonzales, TX 78629

$85,000B+

2 bd · 1.0 ba · 881 sqft · Built 1932 · SingleFamily · Pending · 15 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,250/mo
• Mortgage (P&I): −$446
• Tax + insurance: −$531
• HOA: −$0
• Vac / Maint / Mgmt: −$262
• Net cashflow: $11/mo
• Annual: $130/yr
• Cap rate: 12.47%
• Cash-on-cash: 22.05%
• DSCR: 1.98
• 1% rule: 1.47%
• Cash to close: $23,800

Investor read

• This is a 2-bed/1.0-bath single-family listed at $85k.
• At list price, monthly cash flow is $11 ($130/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $85k).
• It's been on market 15 days — a 2% lower offer ($84k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $84k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $588 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#720 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: schools F, crime F, amenities F.
• Gonzales ISD (town): math 33% / reading 35% proficiency, ranked #540 of 826 in TX (top 65%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: flood insurance adds $427/mo; built in 1932 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 118 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 11 units permitted in Gonzales County in 2024 (0 in 5+ unit buildings).
• Gonzales County population projected at +17% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Current owner paid $72k; 17% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); severe wind risk, 98% chance of damaging wind over 30y; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 12.5% vs local median 2.2% in Gonzales — 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

• Built in 1932 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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 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.
• 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.