1700 Palo Duro Way

Celina, TX 75009

$400,000C-

4 bd · 3.0 ba · 2,427 sqft · Built 2024 · SingleFamily · Active · 71 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,290/mo
• Mortgage (P&I): −$2,098
• Tax + insurance: −$1,098
• HOA: −$135
• Vac / Maint / Mgmt: −$901
• Net cashflow: $59/mo
• Annual: $705/yr
• Cap rate: 6.47%
• Cash-on-cash: 0.63%
• DSCR: 1.03
• 1% rule: 1.07%
• Cash to close: $112,000

Investor read

• This is a 4-bed/3.0-bath single-family listed at $400k. Condition is rated good.
• At list price, monthly cash flow is $59 ($705/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($4k rent vs $400k).
• It's been on market 71 days — a 6% lower offer ($376k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $376k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#450 in TX) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, schools A; Watch: cost of living C-, amenities F, commute F.
• Celina ISD (rural): math 50% / reading 61% proficiency, ranked #71 of 826 in TX (top 9%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: property tax is 2.8% of price.
• Market conditions: Rents falling (-4.6%/yr); 2895 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 19,194 units permitted in Collin County in 2024 (3,988 in 5+ unit buildings).
• Collin County population projected at +60% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 2y ago; this cycle's ask has dropped $165k (29%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Cap rate 6.5% vs local median 2.8% in Celina — 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 ($168k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 71 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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 A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.