305 Hill St

Farmersville, TX 75442

$235,000C-

4 bd · 2.0 ba · 3,240 sqft · Built 1920 · SingleFamily · Active · 278 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,212/mo
• Mortgage (P&I): −$1,232
• Tax + insurance: −$426
• HOA: −$0
• Vac / Maint / Mgmt: −$464
• Net cashflow: $89/mo
• Annual: $1,070/yr
• Cap rate: 6.75%
• Cash-on-cash: 1.63%
• DSCR: 1.07
• 1% rule: 0.94%
• Cash to close: $65,800

Investor read

• This is a 4-bed/2.0-bath single-family listed at $235k.
• At list price, monthly cash flow is $89 ($1k/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 (5.9% below list).
• It's been on market 278 days — a 12% lower offer ($207k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $207k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 69/100 on livability (#425 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A-; Watch: employment D, amenities F, commute F.
• Farmersville ISD (town): math 38% / reading 47% proficiency, ranked #298 of 826 in TX (top 36%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Farmersville Int (math 36% / reading 44%, grade F, #1,514 of 4,322 statewide, top 36%, 598 students, 62% FRL); Farmersville J H (math 42% / reading 46%, grade D, #512 of 1,662 statewide, top 32%, 327 students, 59% FRL); Farmersville H S (math 32% / reading 57%, grade F, #652 of 1,632 statewide, top 43%, 670 students, 53% FRL) — zoned schools average 58% FRL vs 42% district-wide (16 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 418 active listings in the ZIP; solid renter incomes; 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; this cycle's ask has dropped $90k (28%) 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; 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.
• Cap rate 6.7% vs local median 4.0% in Farmersville — 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 278 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1920 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• 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.