2212 County Road 342

McKinney, TX 75071

$794,222F

6 bd · 4.0 ba · 2,176 sqft · Built 2013 · Land · Active · 247 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,825/mo
• Mortgage (P&I): −$4,165
• Tax + insurance: −$844
• HOA: −$0
• Vac / Maint / Mgmt: −$593
• Net cashflow: $-2,777/mo
• Annual: $-33,330/yr
• Cap rate: 2.10%
• Cash-on-cash: -14.99%
• DSCR: 0.33
• 1% rule: 0.36%
• Cash to close: $222,382

Investor read

• This is a 6-bed/4.0-bath land listed at $794k.
• At list price, monthly cash flow is $-3k ($-33k/yr) — negative.
• To cash-flow at today's rent, offer at most $304k (61.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $282k (64.4% below list).
• It's been on market 247 days — a 12% lower offer ($699k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $282k (64.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $5k of loan paydown is wiped out by about $24k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#115 in TX, #3,716 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: cost of living C-, amenities F, commute F.
• Melissa ISD (suburban): math 65% / reading 65% proficiency, ranked #24 of 826 in TX (top 3%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents soft (-2.1%/yr); 2125 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• 4 sale attempts since 2y ago; this cycle's ask is 39611% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; major wildfire risk; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

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 247 days. Have you received any prior offers? Is the seller open to a 64% concession, seller financing, or rate buy-down credit?
• 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 B-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?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• 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.