1604 Baron Ln

Howe, TX 75459

$219,999D-

3 bd · 2.0 ba · 1,461 sqft · Built 2026 · SingleFamily · Pending · 3 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,851/mo
• Mortgage (P&I): −$1,154
• Tax + insurance: −$367
• HOA: −$42
• Vac / Maint / Mgmt: −$389
• Net cashflow: $-100/mo
• Annual: $-1,203/yr
• Cap rate: 5.75%
• Cash-on-cash: -1.95%
• DSCR: 0.91
• 1% rule: 0.84%
• Cash to close: $61,600

Investor read

• This is a 3-bed/2.0-bath single-family listed at $220k. Condition is rated good.
• At list price, monthly cash flow is $-100 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $205k (6.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $185k (15.9% below list).
• Only 3 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $185k (15.9% 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 $7k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#368 in TX) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: amenities F, commute F, health & safety F.
• Howe ISD (rural): math 47% / reading 51% proficiency, ranked #180 of 826 in TX (top 22%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Summit Hill El (358 students, 69% FRL); Howe Middle (math 40% / reading 45%, grade D-, #553 of 1,662 statewide, top 34%, 292 students, 49% FRL); Howe H S (math 52% / reading 62%, grade C, #333 of 1,632 statewide, top 22%, 352 students, 41% FRL).
• Market conditions: 142 active listings in the ZIP; 10 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 60% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• Cap rate 5.7% vs local median 4.5% in Howe — 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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are D-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.