401 Marlow Dr

Flower Mound, TX 75028

$620,000C

4 bd · 2.0 ba · 2,904 sqft · Built 1995 · SingleFamily · Active · 10 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,011/mo
• Mortgage (P&I): −$3,251
• Tax + insurance: −$1,051
• HOA: −$27
• Vac / Maint / Mgmt: −$1,472
• Net cashflow: $1,209/mo
• Annual: $14,514/yr
• Cap rate: 8.63%
• Cash-on-cash: 8.36%
• DSCR: 1.37
• 1% rule: 1.13%
• Cash to close: $173,600

Investor read

• This is a 4-bed/2.0-bath single-family listed at $620k.
• At list price, monthly cash flow is $1k ($15k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $620k).
• Only 10 days on market — expect competitive offers; lowballing is unlikely to land.
• 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 71/100 on livability (#317 in TX) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: amenities F, commute F, cost of living F.
• Lewisville ISD (suburban): math 49% / reading 54% proficiency, ranked #109 of 826 in TX (top 13%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Garden Ridge El (math 62% / reading 62%, grade B, #321 of 4,322 statewide, top 8%, 380 students, 25% FRL) — zoned schools at 25% FRL track the district average.
• Market conditions: Rents soft (-0.2%/yr); 270 active listings in the ZIP; 22 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 45% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• 3 sale attempts since 22y 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 $238k; list at $620k implies a 161% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: moderate wind risk, 26% chance of damaging wind over 30y; extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.6% vs local median 2.5% in Flower Mound — 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.
• At $7,011/mo this rent would consume 56% of the median local household income ($149k/yr) (locally 779% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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.
• 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.