CAPROCK Plan

Denton, TX 76249

$283,990F

3 bd · 2.0 ba · 1,434 sqft · Built — · SingleFamily · Active · 285 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,208/mo
• Mortgage (P&I): −$1,759
• Tax + insurance: −$559
• HOA: −$0
• Vac / Maint / Mgmt: −$464
• Net cashflow: $-573/mo
• Annual: $-6,880/yr
• Cap rate: 4.24%
• Cash-on-cash: -7.33%
• DSCR: 0.67
• 1% rule: 0.66%
• Cash to close: $93,903

Investor read

• This is a 3-bed/2.0-bath single-family listed at $284k. Condition is rated good.
• At list price, monthly cash flow is $-573 ($-7k/yr) — negative.
• To cash-flow at today's rent, offer at most $252k (11.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $221k (22.3% below list).
• It's been on market 285 days — a 12% lower offer ($250k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $221k (22.3% 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 $10k 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+.
• Krum ISD (rural): math 44% / reading 46% proficiency, ranked #218 of 826 in TX (top 26%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Krum Early Education Center (430 students, 49% FRL); Krum Middle (math 48% / reading 47%, grade C-, #408 of 1,662 statewide, top 25%, 541 students, 37% FRL); Krum H S (math 37% / reading 52%, grade F, #652 of 1,632 statewide, top 43%, 686 students, 31% FRL).
• Market conditions: 341 active listings in the ZIP; 14 comparable units currently listed for rent nearby; rentals lingering (median 39d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 57% 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.
• Cap rate 4.2% vs local median 3.4% in Denton — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

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 285 days. Have you received any prior offers? Is the seller open to a 22% 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.