Quick Analysis? Is this Deal worthy?! Spring, Tx 4BR 3BA

[Chris Lockwood]

Hi All!

I recently jumped on the SFR train and have since acquired my first rental and looking at a second rental. This rental happens to be located in Spring, TX East of I-45 near The Woodlands, TX. I have provided a brief review of the numbers below to represent a 4CAP. Please note I have decided to remove management fees and leasing fees as I may try to do that myself. If not, I can hire a realtor for 1 month rent to lease out (2k is what I am hoping to receive/month).

 This is located half mile away from a house I own (my mother lives in it) as well as my first rental so this would be my third purchase within the area. I am hoping that it can generate good cash flow as Spring, TX seems to be a renters market and being close to Exxon HQ and Woodlands. I understand this wont cashflow too much at first (perhaps 100-250 first year) but am curious if this is a good idea for a growth and income approach hoping that this location can make up for the higher price point and lower cash flow for greater price appreciation. Since its also located near my other homes I like the approach but...IS THIS WORTH IT? Would love yalls opinions after looking at the math as I still am not too saavy on underwriting the deal in comparison to other TX projects. 

THANK YOU EVERYONE FOR YOUR QUICK ADVICE AND FEEDBACK!

Calculated Results

Annual Profit & Loss

Rent?$24,000

Vacancy$1,972

Net Rent $22,027

Taxes$7,046

Insurance$1,600

Repairs & Maintenance-$1,321

Property Management? $0

Leasing Fees-$0

Total Expenses? $9,968

Net Operating Income (NOI)-$12,058

Cap Rate-4.96%

Financed Returns

Interest Payment-$8,198

Return After Interest-$3,900

Investment Amount (down payment)-$48,600

Financed Return (ROI)-8.02%

Principal Paydown-$3,277

Net Cash Flow-$622

Cash on Cash Return-1.28%

After Tax Returns

Depreciation-6,185

Taxable Income-$-2,326

Income Taxes-$-930

After Tax Return-$4,830

After Tax Return %-9.94%

After Tax Cash Flow-$1,552

Cash on Cash after Tax 3.20%