1401 Melody Cir

Kaufman, TX 75142

$131,631C

3 bd · 2.0 ba · 1,122 sqft · Built 2002 · SingleFamily · Pending · 9 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,673/mo
• Mortgage (P&I): −$690
• Tax + insurance: −$496
• HOA: −$0
• Vac / Maint / Mgmt: −$351
• Net cashflow: $136/mo
• Annual: $1,629/yr
• Cap rate: 7.53%
• Cash-on-cash: 4.42%
• DSCR: 1.20
• 1% rule: 1.27%
• Cash to close: $36,857

Investor read

• This is a 3-bed/2.0-bath single-family listed at $132k.
• At list price, monthly cash flow is $136 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $132k).
• Only 9 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $910 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#478 in TX) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime A-; Watch: amenities F, commute F, employment D-.
• Kaufman ISD (town): math 38% / reading 39% proficiency, ranked #437 of 826 in TX (top 53%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: J R Phillips El (math 32% / reading 29%, grade F, #2,464 of 4,322 statewide, top 58%, 471 students, 78% FRL) — zoned schools average 78% FRL vs 58% district-wide (20 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: property tax is 4.0% of price.
• Market conditions: 278 active listings in the ZIP; 5 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; 1,747 units permitted in Kaufman County in 2024 (180 in 5+ unit buildings).
• Kaufman County population projected at +43% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: major wind risk, 27% chance of damaging wind over 30y; major wildfire risk; extreme-heat days projected 7→25/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.5% vs local median 4.1% in Kaufman — 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

• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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?
• 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.