Gates Plan

Wylie, TX 75407

$185,999F

3 bd · 2.0 ba · 1,192 sqft · Built — · SingleFamily · Active · 64 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,965/mo
• Mortgage (P&I): −$1,354
• Tax + insurance: −$430
• HOA: −$0
• Vac / Maint / Mgmt: −$413
• Net cashflow: $-232/mo
• Annual: $-2,779/yr
• Cap rate: 5.22%
• Cash-on-cash: -3.84%
• DSCR: 0.83
• 1% rule: 0.76%
• Cash to close: $72,281

Investor read

• This is a 3-bed/2.0-bath single-family listed at $186k. Condition is rated good.
• At list price, monthly cash flow is $-232 ($-3k/yr) — negative.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $186k).
• It's been on market 64 days — a 6% lower offer ($175k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $175k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 69/100 on livability (#419 in TX) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: amenities F, commute F, health & safety F.
• Princeton ISD (suburban): math 51% / reading 47% proficiency, ranked #188 of 826 in TX (top 23%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents soft (-1.0%/yr); 1404 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 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.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→25/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.2% vs local median 4.0% in Wylie — 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?
• It's been on market 64 days. Have you received any prior offers? Is the seller open to a 6% 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.