4 Plan

Temecula, CA 92590

$804,010C

4 bd · 3.0 ba · 2,007 sqft · Built — · MultiFamily · Active · 25 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $8,048/mo
• Mortgage (P&I): −$4,216
• Tax + insurance: −$1,340
• HOA: −$0
• Vac / Maint / Mgmt: −$1,690
• Net cashflow: $802/mo
• Annual: $9,619/yr
• Cap rate: 7.49%
• Cash-on-cash: 4.27%
• DSCR: 1.19
• 1% rule: 1.00%
• Cash to close: $225,123

Investor read

• This is a 4-bed/3.0-bath multifamily listed at $804k. Condition is rated poor.
• At list price, monthly cash flow is $802 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($8k rent vs $804k).
• It's been on market 25 days — a 2% lower offer ($792k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $792k (1.5% below list) — sets the bar for market timing.
• In year one you build about $7k of equity ($6k loan paydown + $1k appreciation (0.1% local appreciation)).
• Location reads 71/100 on livability (#225 in CA) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, crime B+; Watch: cost of living F, health & safety F.
• Temecula Valley Unified (urban): math 55% / reading 69% proficiency, ranked #173 of 1,400 in CA (top 12%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 17% free/reduced lunch — higher-income household profile.
• Zoned schools: Vail Elementary (524 students, 50% FRL); Margarita Middle (825 students, 38% FRL); Temecula Valley High (2,864 students, 25% FRL) — zoned schools average 38% FRL vs 17% district-wide (21 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising fast (+4.6%/yr); 185 active listings in the ZIP; 12 comparable units currently listed for rent nearby; rentals at typical pace (median 14d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 9,195 units permitted in Riverside County in 2024 (1,512 in 5+ unit buildings).
• Riverside County population projected at +22% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• At projected returns (0.1% appreciation + 4.6% rent growth), your $225k cash investment doubles in ~8 years — after that, you're playing with house money.
• By year 6, paydown + projected appreciation supports a ~$45k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 7.5% vs local median 2.6% in Temecula — 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 $8,048/mo this rent would consume 113% of the median local household income ($85k/yr) (locally 130% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.

Repairs flagged (vision-AI assessment)

• Major: roof — Significant damage and potential structural issues.
• Major: exterior — Exposed soil and lack of landscaping/fencing.
• Major: landscaping — No vegetation or landscaping visible in the independent image.