20427 Lakeside Dr

Porter Heights, TX 77365

$249,000D+

4 bd · 2.0 ba · 2,028 sqft · Built 1971 · SingleFamily · Pending · 62 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,308/mo
• Mortgage (P&I): −$1,306
• Tax + insurance: −$516
• HOA: −$5
• Vac / Maint / Mgmt: −$485
• Net cashflow: $-3/mo
• Annual: $-36/yr
• Cap rate: 6.28%
• Cash-on-cash: -0.05%
• DSCR: 1.00
• 1% rule: 0.93%
• Cash to close: $69,720

Investor read

• This is a 4-bed/2.0-bath single-family listed at $249k.
• At list price, monthly cash flow is $-3 ($-36/yr) — negative.
• To cash-flow at today's rent, offer at most $248k (0.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $231k (7.3% below list).
• It's been on market 62 days — a 6% lower offer ($234k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $231k (7.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#663 in TX) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, cost of living A+; Watch: amenities F, commute F, health & safety F.
• New Caney ISD (suburban): math 31% / reading 32% proficiency, ranked #570 of 826 in TX (top 69%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: White Oak Middle (math 38% / reading 32%, grade F, #842 of 1,662 statewide, top 51%, 834 students, 75% FRL); New Caney H S (math 24% / reading 31%, grade F, #1,183 of 1,632 statewide, top 73%, 2,428 students, 78% FRL) — zoned schools average 76% FRL vs 57% district-wide (20 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising (+1.6%/yr); 956 active listings in the ZIP; 2 comparable units currently listed for rent nearby; solid renter incomes; 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.
• 11 sale attempts since 12y ago; this cycle's ask is 11218% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• 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 6.3% vs local median 2.5% in Porter Heights — 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?
• It's been on market 62 days. Have you received any prior offers? Is the seller open to a 7% concession, seller financing, or rate buy-down credit?
• Built in 1971 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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 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?
• 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?