Gray Plan

Conroe, TX 77304

$254,990F

3 bd · 2.0 ba · 1,433 sqft · Built — · SingleFamily · Active · 538 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,032/mo
• Mortgage (P&I): −$1,578
• Tax + insurance: −$501
• HOA: −$0
• Vac / Maint / Mgmt: −$427
• Net cashflow: $-474/mo
• Annual: $-5,690/yr
• Cap rate: 4.40%
• Cash-on-cash: -6.75%
• DSCR: 0.70
• 1% rule: 0.68%
• Cash to close: $84,244

Investor read

• This is a 3-bed/2.0-bath single-family listed at $255k.
• At list price, monthly cash flow is $-474 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $232k (8.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $203k (20.3% below list).
• It's been on market 538 days — a 12% lower offer ($224k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $203k (20.3% 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 $9k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#169 in TX, #4,447 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, amenities B; Watch: commute F, health & safety F.
• Conroe ISD (other): math 57% / reading 57% proficiency, ranked #69 of 826 in TX (top 8%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Giesinger El (math 61% / reading 52%, grade C+, #559 of 4,322 statewide, top 13%, 741 students, 48% FRL); Peet J H (math 45% / reading 50%, grade C-, #408 of 1,662 statewide, top 25%, 1,289 students, 58% FRL); Conroe H S (math 32% / reading 51%, grade F, #767 of 1,632 statewide, top 47%, 4,915 students, 61% FRL) — zoned schools average 56% FRL vs 34% district-wide (21 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents soft (-1.6%/yr); 756 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.
• Climate carrying-cost: severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 6→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.4% vs local median 3.1% in Conroe — 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 30% of the median local income ($80k/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?
• It's been on market 538 days. Have you received any prior offers? Is the seller open to a 20% concession, seller financing, or rate buy-down credit?
• 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?
• 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.