Shipton Plan

Denton, TX 76226

$363,990F

4 bd · 2.0 ba · 1,877 sqft · Built — · SingleFamily · Active · 328 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,876/mo
• Mortgage (P&I): −$2,099
• Tax + insurance: −$667
• HOA: −$0
• Vac / Maint / Mgmt: −$604
• Net cashflow: $-494/mo
• Annual: $-5,932/yr
• Cap rate: 4.81%
• Cash-on-cash: -5.29%
• DSCR: 0.76
• 1% rule: 0.72%
• Cash to close: $112,077

Investor read

• This is a 4-bed/2.0-bath single-family listed at $364k.
• At list price, monthly cash flow is $-494 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $329k (9.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $288k (21.0% below list).
• It's been on market 328 days — a 12% lower offer ($320k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $288k (21.0% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k 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+.
• Denton ISD (urban): math 36% / reading 43% proficiency, ranked #383 of 826 in TX (top 46%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising (+1.6%/yr); 1110 active listings in the ZIP; 23 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 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.
• 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 4.8% vs local median 3.4% in Denton — 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 328 days. Have you received any prior offers? Is the seller open to a 21% 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.