308 Valley Ridge Dr

Red Oak, TX 75154

$360,000D-

5 bd · 3.0 ba · 3,020 sqft · Built 2003 · SingleFamily · Active · 9 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,169/mo
• Mortgage (P&I): −$1,888
• Tax + insurance: −$749
• HOA: −$17
• Vac / Maint / Mgmt: −$665
• Net cashflow: $-150/mo
• Annual: $-1,803/yr
• Cap rate: 5.79%
• Cash-on-cash: -1.79%
• DSCR: 0.92
• 1% rule: 0.88%
• Cash to close: $100,800

Investor read

• This is a 5-bed/3.0-bath single-family listed at $360k.
• At list price, monthly cash flow is $-150 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $333k (7.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $317k (12.0% below list).
• Only 9 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $317k (12.0% 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 $11k of value loss. Plan a longer hold.
• Location reads 69/100 on livability (#435 in TX) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, cost of living A; Watch: amenities F, commute F.
• Red Oak ISD (suburban): math 40% / reading 36% proficiency, ranked #384 of 826 in TX (top 46%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Red Oak El (math 42% / reading 33%, grade F, #1,744 of 4,322 statewide, top 41%, 528 students, 64% FRL) — zoned schools average 64% FRL vs 42% district-wide (23 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising (+3.0%/yr); 565 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals leasing fast (median 11d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 3,016 units permitted in Ellis County in 2024 (20 in 5+ unit buildings).
• Ellis County population projected at +36% 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→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.8% vs local median 3.9% in Red Oak — 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.
• This rent runs 38% of the median local income ($100k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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?
• 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.