109 Thelma

Josephine, TX 75173

$175,000D+

2 bd · 1.0 ba · 936 sqft · Built 2006 · SingleFamily · Pending · 19 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,400/mo
• Mortgage (P&I): −$918
• Tax + insurance: −$367
• HOA: −$0
• Vac / Maint / Mgmt: −$294
• Net cashflow: $-178/mo
• Annual: $-2,141/yr
• Cap rate: 5.07%
• Cash-on-cash: -4.37%
• DSCR: 0.81
• 1% rule: 0.80%
• Cash to close: $49,000

Investor read

• This is a 2-bed/1.0-bath single-family listed at $175k.
• At list price, monthly cash flow is $-178 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $143k (18.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $140k (20.0% below list).
• It's been on market 19 days — a 2% lower offer ($172k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $140k (20.0% below list) — sets the bar for 1% rule.
• In year one you build about $19k of equity ($1k loan paydown + $18k appreciation (10.0% local appreciation)).
• Location reads 60/100 on livability (#1,076 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A-; Watch: amenities F, commute F, health & safety F.
• Community ISD (rural): math 30% / reading 38% proficiency, ranked #479 of 826 in TX (top 58%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Mcclendon El (math 29% / reading 35%, grade F, #2,268 of 4,322 statewide, top 55%, 697 students, 66% FRL) — zoned schools average 66% FRL vs 36% district-wide (30 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: 421 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 19,194 units permitted in Collin County in 2024 (3,988 in 5+ unit buildings).
• Collin County population projected at +60% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 8y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• By year 2, paydown + projected appreciation supports a ~$30k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; major wildfire risk; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

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?
• 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?
• 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.