Private Equity · Southwest Houston · Full Gut Rehab · BRRRR
Brand New
Gut Rehab in
Mission Bend.
16715 Sussex Dr · Houston, TX 77083
Chelsea at Mission Bend · Fort Bend County · Fort Bend ISD
Redfin ↗ · HAR.com ↗
Chelsea at Mission Bend · Fort Bend County · Fort Bend ISD
Redfin ↗ · HAR.com ↗
Purchase Price
$140K
Cash acquisition
Full Gut Rehab
$130K
Brand new — zero CapEx
Day-One Equity
$140K
ARV $360K − $220K loan
5-Year Equity
~$210K
3%/yr appreciation
Beds
3 BR
Baths
2.5 BA
Size
2,463 ft²
Lot
8,407 ft²
County
Fort Bend
Deal Walkthrough
Step-by-Step: Every Dollar Accounted For
$140K purchase. $130K full gut renovation. $220K DSCR loan. Two paths shown — close with cash (saves ~$9,833 in HML costs) or use a hard money lender for less upfront capital.
01
Purchase & Closing
Purchase price$140,000
Title search & insurance$900
Escrow / closing fees$750
Recording & attorney$350
If using Hard Money Lender
HML origination (2.5 pts)+$3,500
HML lender fees+$1,500
✓ Close cash = save ~$5,000
Cash close total$142,000
→
02
Full Gut Rehab + Holding
Full gut rehab budget$130,000
Utilities (4 months)$600
Dwelling insurance$625
Property taxes (pro-rated)$1,120
Misc. holding costs$155
If using Hard Money Lender
HML interest (10%/yr × 4 mo.)+$4,667
$140K × 10% ÷ 12 × 4≈ $4,667
✓ Close cash = save ~$4,667
Rehab + hold total$132,500
→
03
DSCR Refinance
Estimated ARV$360,000
DSCR loan (61.1% LTV)$220,000
Refi Closing Costs
Origination (2 pts)−$4,400
Appraisal−$700
Title insurance (refi)−$1,100
Escrow / recording / misc.−$900
Net cash returned$212,900
→
04
Final Position
Option A — Cash Close
Total cash deployed$274,500
Cash returned at refi$212,900
Cash left in deal~$61,600
Option B — HML
Extra HML costs added+$9,833
Cash left in deal (HML)~$71,433
Day-one equity$140,000
LTV at refinance61.1% — conservative
Equity-to-cash ratio2.3x
⚠ Estimate — Subject to Change
All figures are estimates and approximations. Actual closing costs, lender fees, rehab costs, and cash to close are subject to change based on final lender terms, appraisal, title work, and market conditions. Verify all numbers with your lender and title company before committing capital.
✓ Option A — Cash Close (Recommended)
Total cash needed upfront~$274,500
Cash returned at DSCR refi~$212,900
Net cash left in deal~$61,600
Day-one equity captured$140,000
LTV at refinance61.1% — lender-friendly
Savings vs. hard money~$9,833
*Estimate. Subject to change based on final lender terms, appraisal & title work. Not a guarantee of performance.
Option B — Hard Money Lender
Less upfront capital neededLower day-one requirement
HML fees + interest added+$9,833
Net cash left in deal~$71,433
Day-one equity (same)$140,000
Extra cost vs. cash close+$9,833
*Estimate. Subject to change based on final terms. HML costs vary by lender.
Monthly Analysis
All Expenses. Every Dollar.
Full gut rehab = brand new property = zero CapEx reserve. Taxes assessed on $320K (not the full ARV). At $2,600/mo rent with self-management this deal hits 1.08x DSCR with positive cash flow.
Income
Gross monthly rent (est.)$2,600
Gross income$2,600/mo
Operating Expenses
Vacancy allowance (8%)−$208
CapEx reserve$0 — brand new rehab
Maintenance (2%)−$52
Property management (10%)−$260
NOI with management$2,080/mo
NOI self-managed (no mgmt fee)$2,340/mo
Debt Service (PITI) — $220K @ 7%, 30yr
Principal & interest (P&I)−$1,464
Property taxes (2.1% × $320K assessed)−$560
Homeowner's insurance−$150
Total PITI−$2,174/mo
Net Cash Flow
With property management−$94/mo · 0.96x
Self-managed ★+$166/mo · 1.08x ✓
Annual paydown (principal)+~$2,164/yr
Cash flow — scenarios
$2,600 · with mgmt (10%)−$94/mo · 0.96x
$2,600 · self-manage ★+$166/mo · 1.08x ✓
Annual cash flow (self-manage)+$1,992/yr
Annual principal paydown+$2,164/yr
Total annual wealth gain+~$14,964/yr
With mgmt: 0.96x — just below threshold
Self-manage: 1.08x ✓ Lender qualified
Total annual wealth creation (self-manage)
Cash flow+$1,992
Principal paydown+$2,164
Appreciation (3% × $360K)+$10,800
Year 1 total wealth gain+~$14,956
On $61,600 invested24.3% annual return
Why zero CapEx matters
Typical 5% CapEx on $2,600 rent−$130/mo saved
Annual CapEx savings+$1,560/yr
New roof, HVAC, plumbing, electricAll replaced
ResultNo major repairs for years
Side-by-side scenario comparison
ScenarioLoanCash Left InMonthly CFDSCR
$220K loan · with mgmt
$220K~$61.6K
−$94/mo
0.96x
$220K loan · self-manage ★
$220K~$61.6K
+$166/mo
1.08x ✓
*All figures are estimates and subject to change based on final lender terms, appraisal, and market conditions.
5-Year Equity Projection
$140,000 Equity Captured Day One
At 61% LTV and $140K day-one equity on ~$61.6K invested, this deal delivers a 2.3x equity-to-cash ratio from day one. Fort Bend's 3% appreciation grows that to ~$210K by year five.
Day One
$360,000
Equity: $140,000
Loan: $220K
Year 1
$370,800
Equity: $153,035
+$13,035
Year 2
$381,924
Equity: $166,555
+$26,555
Year 3
$393,382
Equity: $180,582
+$40,582
Year 4
$405,183
Equity: $195,139
+$55,139
Year 5 ★
$417,339
Equity: ~$210K
+$70K from today
Year 5 includes ~$12,911 in actual principal paydown plus $57K in appreciation. Investor holds a $417K asset with ~$61.6K invested and ~$210K in equity — a 3.4x return on capital in 5 years, plus $166/mo positive cash flow. Projections are estimates subject to market conditions.
Market Intelligence
Why Mission Bend, Fort Bend County
Chelsea at Mission Bend is a well-established southwest Houston corridor with Fort Bend ISD schools, strong freeway access, and a growing family rental demographic. The 2,463 sq ft floor plan is one of the largest available post-rehab in this submarket.
45¢
Buying at 45 cents on the dollar vs Redfin's $311,655 current estimate
Fort Bend ISD
One of Texas's highest-rated large districts — families specifically target this area
$0 CapEx
Brand new gut rehab — roof, HVAC, plumbing, electric, kitchen, baths all new
2,463 ft²
Largest rental floor plan in the comp set — commands premium rent of $2,600+
24.3%
Year 1 total return on capital (cash flow + paydown + appreciation) on $61.6K invested
Hwy 6
Minutes to Hwy 6, Beltway 8, and Westpark Tollway — major SW Houston corridors
$140K equity on day one. Buying at $140K on a $360K ARV property — backed by Redfin's $311K as-is estimate — creates $140,000 in equity the moment the DSCR loan closes. That's not projected; it's manufactured through acquisition discipline.
Brand new gut rehab eliminates the biggest landlord cost. CapEx typically runs 5–7% of rent for older homes. At $0/mo here, the investor saves $1,560–$2,184/yr compared to a comparable unrehabbed rental. New systems means no major repair bills for 10–15 years.
Taxes assessed on $320K — not the $360K ARV. Fort Bend County's appraisal lags market value, especially on rehabbed homes. The $320K assessed base saves $84/mo vs taxing at full ARV — and that gap may persist for several years before the county catches up.
Fort Bend ISD families = long-term tenants. Families targeting Fort Bend ISD schools typically sign 2–4 year leases and treat properties well. This translates to lower vacancy (well below the 8% underwritten), lower turnover costs, and more predictable cash flow.
Southwest Houston growth corridor. Mission Bend benefits from proximity to the Energy Corridor, Sugar Land, and Westchase District employment centers. Houston metro population growth of 126,000+ annually continues to push demand southwest, supporting both rents and values.
Investment Thesis
Three Reasons This Deal Stands Apart
01
$140K equity on $61.6K invested — 2.3x day one
Buying at $140K on a $360K ARV property creates $140,000 in equity at refinance — a 61% LTV loan that any DSCR lender approves comfortably. The investor holds more equity than cash in the deal from day one.
02
Zero CapEx — brand new everything
A $130K full gut renovation replaces every major system — roof, HVAC, plumbing, electric, kitchen, baths, flooring. Zero CapEx reserve needed. That's $130–$160/mo in savings vs an older property, compounding into thousands of dollars annually.
03
3.4x return on capital in 5 years
~$61.6K left in the deal grows to ~$210K in equity by year 5 — a 3.4x return — while generating +$166/mo cash flow (self-managed) and $2,164/yr in principal paydown. Total year-1 return on capital: ~24.3%.