Compass Plan

Sherman, TX 75090

$249,990F

3 bd · 2.0 ba · 1,400 sqft · Built — · SingleFamily · Active · 282 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,953/mo
• Mortgage (P&I): −$1,655
• Tax + insurance: −$526
• HOA: −$0
• Vac / Maint / Mgmt: −$410
• Net cashflow: $-638/mo
• Annual: $-7,656/yr
• Cap rate: 3.87%
• Cash-on-cash: -8.67%
• DSCR: 0.61
• 1% rule: 0.62%
• Cash to close: $88,357

Investor read

• This is a 3-bed/2.0-bath single-family listed at $250k. Condition is rated good.
• At list price, monthly cash flow is $-638 ($-8k/yr) — negative.
• To cash-flow at today's rent, offer at most $223k (10.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $195k (21.9% below list).
• It's been on market 282 days — a 12% lower offer ($220k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $195k (21.9% 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 $9k of value loss. Plan a longer hold.
• Location reads 61/100 on livability (#1,027 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: crime C-, employment C-, amenities F.
• Sherman ISD (urban): math 31% / reading 37% proficiency, ranked #546 of 826 in TX (top 66%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Henry W Sory El (math 35% / reading 43%, grade F, #1,651 of 4,322 statewide, top 39%, 548 students, 69% FRL); Piner Middle (math 31% / reading 41%, grade F, #805 of 1,662 statewide, top 50%, 818 students, 75% FRL); Sherman H S (math 28% / reading 44%, grade F, #930 of 1,632 statewide, top 57%, 2,155 students, 70% FRL).
• Market conditions: Rents soft (-2.7%/yr); 601 active listings in the ZIP; 17 comparable units currently listed for rent nearby; rentals lingering (median 70d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% 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.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• This rent runs 42% of the median local income ($56k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 282 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 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.