21575 Bluebonnet Bay Dr

Magnolia, TX 77354

$409,900D+

5 bd · 2.5 ba · 2,594 sqft · Built 2026 · SingleFamily · Pending · 27 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,955/mo
• Mortgage (P&I): −$2,150
• Tax + insurance: −$683
• HOA: −$40
• Vac / Maint / Mgmt: −$620
• Net cashflow: $-539/mo
• Annual: $-6,463/yr
• Cap rate: 4.72%
• Cash-on-cash: -5.63%
• DSCR: 0.75
• 1% rule: 0.72%
• Cash to close: $114,772

Investor read

• This is a 5-bed/2.5-bath single-family listed at $410k.
• At list price, monthly cash flow is $-539 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $332k (19.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $295k (27.9% below list).
• It's been on market 27 days — a 2% lower offer ($404k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $295k (27.9% below list) — sets the bar for 1% rule.
• In year one you build about $44k of equity ($3k loan paydown + $41k appreciation (10.0% local appreciation)).
• Location reads 73/100 on livability (#222 in TX) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: schools D+, amenities F, commute F.
• Magnolia ISD (rural): math 42% / reading 45% proficiency, ranked #247 of 826 in TX (top 30%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents flat; 1622 active listings in the ZIP; 2 comparable units currently listed for rent nearby; high-income renter base; 13,259 units permitted in Montgomery County in 2024 (1,402 in 5+ unit buildings).
• Montgomery County population projected at +65% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• By year 2, paydown + projected appreciation supports a ~$70k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: moderate flood risk; severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.7% vs local median 3.4% in Magnolia — 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 32% of the median local income ($113k/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?
• 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?
• 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.