404 Pecan Dr

Dallas, TX 75203

$499,900D

4 bd · 3.5 ba · 2,600 sqft · Built 2026 · Land · Pending · 39 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,275/mo
• Mortgage (P&I): −$2,622
• Tax + insurance: −$385
• HOA: −$0
• Vac / Maint / Mgmt: −$688
• Net cashflow: $-419/mo
• Annual: $-5,026/yr
• Cap rate: 5.29%
• Cash-on-cash: -3.59%
• DSCR: 0.84
• 1% rule: 0.66%
• Cash to close: $139,972

Investor read

• This is a 4-bed/3.5-bath land listed at $500k.
• At list price, monthly cash flow is $-419 ($-5k/yr) — negative.
• To cash-flow at today's rent, offer at most $426k (14.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $328k (34.5% below list).
• It's been on market 39 days — a 3% lower offer ($485k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $328k (34.5% below list) — sets the bar for 1% rule.
• In year one you build about $53k of equity ($3k loan paydown + $50k appreciation (10.0% local appreciation)).
• Location reads 81/100 on livability (#24 in TX, #1,380 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, housing A+; Watch: crime F.
• Dallas ISD (urban): math 31% / reading 36% proficiency, ranked #559 of 826 in TX (top 68%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 83% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Cedar Crest El (math 52% / reading 37%, grade F, #1,155 of 4,322 statewide, top 29%, 321 students, 100% FRL) — zoned schools average 100% FRL vs 83% district-wide (16 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents soft (-2.7%/yr); 146 active listings in the ZIP; 36 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; 12,577 units permitted in Dallas County in 2024 (6,829 in 5+ unit buildings).
• Dallas County population projected at +35% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• By year 2, paydown + projected appreciation supports a ~$86k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major flood risk; major wind risk, 27% chance of damaging wind over 30y; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.3% vs local median 2.3% in Dallas — 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.
• At $3,275/mo this rent would consume 84% of the median local household income ($47k/yr) (locally 948% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 39 days. Have you received any prior offers? Is the seller open to a 34% concession, seller financing, or rate buy-down credit?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.