1602 Colorado St

Houston, TX 77007

$329,000C

2 bd · 2.0 ba · 1,842 sqft · Built 2006 · Townhouse · Pending · 18 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,802/mo
• Mortgage (P&I): −$1,725
• Tax + insurance: −$695
• HOA: −$219
• Vac / Maint / Mgmt: −$798
• Net cashflow: $364/mo
• Annual: $4,368/yr
• Cap rate: 7.62%
• Cash-on-cash: 4.74%
• DSCR: 1.21
• 1% rule: 1.16%
• Cash to close: $92,120

Investor read

• This is a 2-bed/2.0-bath townhouse listed at $329k.
• At list price, monthly cash flow is $364 ($4k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($4k rent vs $329k).
• It's been on market 18 days — a 2% lower offer ($324k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $324k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#184 in TX, #4,771 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, cost of living A+, housing A+; Watch: crime F.
• Houston ISD (urban): math 27% / reading 35% proficiency, ranked #593 of 826 in TX (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 71% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Hogg Middle (math 44% / reading 48%, grade D+, #462 of 1,662 statewide, top 28%, 1,120 students, 52% FRL); Heights H S (math 27% / reading 57%, grade F, #730 of 1,632 statewide, top 47%, 2,476 students, 65% FRL).
• Zoned-school proficiency averages 44% at this address vs 31% district-wide (+13 pts) — the actual schools serving this property are materially stronger than the Houston ISD average implies; a family-tenant draw the district grade alone would hide.
• Market conditions: Rents soft (-0.8%/yr); 646 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals leasing fast (median 11d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 29,883 units permitted in Harris County in 2024 (8,621 in 5+ unit buildings).
• Harris County population projected at +47% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 20 sale attempts since 18y ago 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: 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 7.6% vs local median 3.2% in Houston — 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 31% of the median local income ($145k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• 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?
• 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.