6113 Avenue Q 1/2

Galveston, TX 77551

$275,000D-

4 bd · 1.0 ba · 1,976 sqft · Built 1965 · MultiFamily · Active · 282 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,700/mo
• Mortgage (P&I): −$1,442
• Tax + insurance: −$818
• HOA: −$0
• Vac / Maint / Mgmt: −$357
• Net cashflow: $-917/mo
• Annual: $-11,003/yr
• Cap rate: 4.15%
• Cash-on-cash: -7.64%
• DSCR: 0.66
• 1% rule: 0.62%
• Cash to close: $77,000

Investor read

• This is a 2 × 2-bed/1.0-bath units multifamily listed at $275k. Condition is rated fair.
• At list price, monthly cash flow is $-917 ($-11k/yr) — negative. Per door: $-458/mo.
• To cash-flow at today's rent, offer at most $113k (58.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $170k (38.2% below list).
• It's been on market 282 days — a 12% lower offer ($242k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $113k (58.9% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#108 in TX, #3,559 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: amenities D+, employment D, crime F.
• Galveston ISD (town): math 33% / reading 39% proficiency, ranked #514 of 826 in TX (top 62%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Oppe El (math 67% / reading 60%, grade B, #291 of 4,322 statewide, top 7%, 610 students, 63% FRL); Central Middle (math 18% / reading 21%, grade F, #1,445 of 1,662 statewide, top 88%, 879 students, 80% FRL); Ball H S (math 17% / reading 44%, grade F, #1,085 of 1,632 statewide, top 67%, 1,934 students, 73% FRL) — zoned schools at 72% FRL track the district average.
• Watch-outs: flood insurance adds $427/mo.
• Market conditions: 531 active listings in the ZIP; 12 comparable units currently listed for rent nearby; rentals lingering (median 89d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 75% of comp listings sitting > 30 days — soft ceiling on asking rent; 3,258 units permitted in Galveston County in 2024 (0 in 5+ unit buildings).
• Galveston County population projected at +43% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance); severe wind risk, 99% chance of damaging wind over 30y; extreme-heat days projected 7→26/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.2% vs local median 0.4% in Galveston — 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 per unit is only 17% of the median local income ($58k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

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 282 days. Have you received any prior offers? Is the seller open to a 59% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1965 — 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?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?

Repairs flagged (vision-AI assessment)

• Major: roof — The independent satellite image shows significant wear and tear on the composition roof.
• Moderate: exterior siding — The exterior siding shows some discoloration and minor damage.
• Minor: landscaping — The landscaping appears overgrown and in need of maintenance.