42 Epsom Dr

Sherwood Shores, TX 76245

$219,900D-

4 bd · 3.0 ba · 2,128 sqft · Built 1999 · Manufactured · Active · 115 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,524/mo
• Mortgage (P&I): −$1,153
• Tax + insurance: −$205
• HOA: −$0
• Vac / Maint / Mgmt: −$320
• Net cashflow: $-154/mo
• Annual: $-1,852/yr
• Cap rate: 5.45%
• Cash-on-cash: -3.01%
• DSCR: 0.87
• 1% rule: 0.69%
• Cash to close: $61,572

Investor read

• This is a 4-bed/3.0-bath manufactured listed at $220k.
• At list price, monthly cash flow is $-154 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $193k (12.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $152k (30.7% below list).
• It's been on market 115 days — a 9% lower offer ($200k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $152k (30.7% below list) — sets the bar for 1% rule.
• In year one you build about $1k of equity ($2k loan paydown + $-146 appreciation (-0.1% local appreciation)).
• Location reads 49/100 on livability (#1,519 in TX) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+, housing A+; Watch: schools F, crime F, amenities F.
• Whitesboro ISD (town): math 43% / reading 46% proficiency, ranked #272 of 826 in TX (top 33%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 353 active listings in the ZIP; 2,272 units permitted in Grayson County in 2024 (750 in 5+ unit buildings).
• Grayson County population projected at +12% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.5% vs local median 2.8% in Sherwood Shores — 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 115 days. Have you received any prior offers? Is the seller open to a 31% 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 F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.