3301 Emerald Trace Dr

Denton, TX 76226

$639,990F

5 bd · 4.0 ba · 3,487 sqft · Built 2026 · Land · Active · 120 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,187/mo
• Mortgage (P&I): −$3,356
• Tax + insurance: −$1,067
• HOA: −$52
• Vac / Maint / Mgmt: −$669
• Net cashflow: $-1,957/mo
• Annual: $-23,485/yr
• Cap rate: 2.62%
• Cash-on-cash: -13.11%
• DSCR: 0.42
• 1% rule: 0.50%
• Cash to close: $179,197

Investor read

• This is a 5-bed/4.0-bath land listed at $640k.
• At list price, monthly cash flow is $-2k ($-23k/yr) — negative.
• To cash-flow at today's rent, offer at most $357k (44.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $319k (50.2% below list).
• It's been on market 120 days — a 9% lower offer ($582k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $319k (50.2% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $19k of value loss. Plan a longer hold.
• Location reads 88/100 on livability (#2 in TX, #210 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, housing A+.
• Argyle ISD (rural): math 71% / reading 67% proficiency, ranked #8 of 826 in TX (top 1%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 13% free/reduced lunch — higher-income household profile.
• Market conditions: Rents rising (+1.6%/yr); 1110 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals leasing fast (median 14d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 10,531 units permitted in Denton County in 2024 (2,713 in 5+ unit buildings).
• Denton County population projected at +66% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts; this cycle's ask has dropped $58k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Cap rate 2.6% vs local median 3.4% in Denton — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.

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 120 days. Have you received any prior offers? Is the seller open to a 50% concession, seller financing, or rate buy-down credit?
• 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 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.