7348 Palomar Ave

Yucca Valley, CA 92284

$329,000D

3 bd · 2.0 ba · 1,719 sqft · Built 1961 · SingleFamily · Pending · 110 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,464/mo
• Mortgage (P&I): −$1,725
• Tax + insurance: −$396
• HOA: −$0
• Vac / Maint / Mgmt: −$518
• Net cashflow: $-174/mo
• Annual: $-2,091/yr
• Cap rate: 5.66%
• Cash-on-cash: -2.27%
• DSCR: 0.90
• 1% rule: 0.75%
• Cash to close: $92,120

Investor read

• This is a 3-bed/2.0-bath single-family listed at $329k.
• At list price, monthly cash flow is $-174 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $298k (9.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $246k (25.1% below list).
• It's been on market 110 days — a 9% lower offer ($299k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $246k (25.1% 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 $10k of value loss. Plan a longer hold.
• Location reads 60/100 on livability (#566 in CA) — a middle-class / working-renter tenant base. Strengths: commute A+, housing A+; Watch: cost of living D+, crime D-, amenities D-.
• Morongo Unified (town): math 15% / reading 38% proficiency, ranked #395 of 517 in CA (top 76%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Onaga Elementary (580 students, 58% FRL); La Contenta Middle (math 11% / reading 27%, grade F, #426 of 498 statewide, top 86%, 650 students, 72% FRL); Yucca Valley High (math 15% / reading 49%, grade F, #674 of 1,170 statewide, top 59%, 1,264 students, 64% FRL).
• Market conditions: Rents rising fast (+4.1%/yr); 573 active listings in the ZIP; 10 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 60% of comp listings sitting > 30 days — soft ceiling on asking rent; 5,458 units permitted in San Bernardino County in 2024 (1,500 in 5+ unit buildings).
• San Bernardino County population projected at +15% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 3 sale attempts since 15y ago; this cycle's ask has dropped $36k (10%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $100k; list at $329k implies a 229% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: moderate wildfire risk; extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.7% vs local median 3.6% in Yucca Valley — 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 $2,464/mo this rent would consume 51% of the median local household income ($58k/yr) (locally 1132% 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 110 days. Have you received any prior offers? Is the seller open to a 25% concession, seller financing, or rate buy-down credit?
• Built in 1961 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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 F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• Crime grade is D 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?