1012 Joe Bailey St

Royse City, TX 75189

$275,000D

3 bd · 2.0 ba · 1,706 sqft · Built 2024 · Land · Active · 198 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,211/mo
• Mortgage (P&I): −$1,442
• Tax + insurance: −$237
• HOA: −$0
• Vac / Maint / Mgmt: −$464
• Net cashflow: $67/mo
• Annual: $808/yr
• Cap rate: 6.59%
• Cash-on-cash: 1.05%
• DSCR: 1.05
• 1% rule: 0.80%
• Cash to close: $77,000

Investor read

• This is a 3-bed/2.0-bath land listed at $275k.
• At list price, monthly cash flow is $67 ($808/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $221k (19.6% below list).
• It's been on market 198 days — a 12% lower offer ($242k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $221k (19.6% 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 $8k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#158 in TX, #4,292 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: amenities F, commute F.
• Royse City ISD (rural): math 42% / reading 42% proficiency, ranked #266 of 826 in TX (top 32%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: W R (Bill) Fort El (math 51% / reading 36%, grade F, #1,269 of 4,322 statewide, top 30%, 614 students, 36% FRL); Ouida Baley Middle (math 32% / reading 35%, grade F, #911 of 1,662 statewide, top 56%, 934 students, 43% FRL); Royse City H S (math 38% / reading 55%, grade D-, #621 of 1,632 statewide, top 38%, 2,526 students, 37% FRL) — zoned schools at 38% FRL track the district average.
• Market conditions: Rents soft (-1.1%/yr); 1301 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 21d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 1,810 units permitted in Rockwall County in 2024 (0 in 5+ unit buildings).
• Rockwall County population projected at +56% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 5 sale attempts since 6y ago; this cycle's ask has dropped $25k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; moderate wildfire risk; extreme-heat days projected 7→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.6% vs local median 4.2% in Royse City — 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

• It's been on market 198 days. Have you received any prior offers? Is the seller open to a 20% 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.
• 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.