1012 Oak St

McKinney, TX 75069

$225,000D

3 bd · 1.0 ba · 888 sqft · Built 1957 · SingleFamily · Pending · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,823/mo
• Mortgage (P&I): −$1,180
• Tax + insurance: −$490
• HOA: −$0
• Vac / Maint / Mgmt: −$383
• Net cashflow: $-230/mo
• Annual: $-2,754/yr
• Cap rate: 5.07%
• Cash-on-cash: -4.37%
• DSCR: 0.81
• 1% rule: 0.81%
• Cash to close: $63,000

Investor read

• This is a 3-bed/1.0-bath single-family listed at $225k.
• At list price, monthly cash flow is $-230 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $184k (18.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $182k (19.0% below list).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $182k (19.0% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k 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.
• Mckinney ISD (suburban): math 54% / reading 58% proficiency, ranked #72 of 826 in TX (top 9%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Finch El (math 42% / reading 47%, grade F, #1,155 of 4,322 statewide, top 29%, 325 students, 86% FRL) — zoned schools average 86% FRL vs 28% district-wide (58 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1957 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents soft (-2.1%/yr); 298 active listings in the ZIP; 28 comparable units currently listed for rent nearby; rentals leasing fast (median 4d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 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.
• 2 sale attempts since 10y 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.
• Current owner paid $51k; list at $225k implies a 342% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; moderate wildfire risk; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.1% vs local median 2.5% in McKinney — 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.

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?
• Built in 1957 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• 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.