7220 E Mary Sharon Dr #158

Scottsdale, AZ 85266

$475,000F

2 bd · 3.0 ba · 1,264 sqft · Built 1985 · Townhouse · Active · 20 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,030/mo
• Mortgage (P&I): −$2,491
• Tax + insurance: −$792
• HOA: −$347
• Vac / Maint / Mgmt: −$846
• Net cashflow: $-446/mo
• Annual: $-5,347/yr
• Cap rate: 5.17%
• Cash-on-cash: -4.02%
• DSCR: 0.82
• 1% rule: 0.85%
• Cash to close: $133,000

Investor read

• This is a 2-bed/3.0-bath townhouse listed at $475k.
• At list price, monthly cash flow is $-446 ($-5k/yr) — negative.
• To cash-flow at today's rent, offer at most $411k (13.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $403k (15.1% below list).
• It's been on market 20 days — a 2% lower offer ($468k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $403k (15.1% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $14k of value loss. Plan a longer hold.
• Location reads 80/100 on livability (#4 in AZ, #1,756 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, employment A+; Watch: health & safety C-, cost of living F.
• Cave Creek Unified District (4244) (urban): math 57% / reading 59% proficiency, ranked #13 of 249 in AZ (top 5%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 8% free/reduced lunch — higher-income household profile.
• Zoned schools: Lone Mountain Elementary School (math 63% / reading 65%, grade B, #115 of 1,109 statewide, top 11%, 423 students, 8% FRL); Sonoran Trails Middle School (math 48% / reading 50%, grade C-, #31 of 218 statewide, top 14%, 761 students, 7% FRL); Cactus Shadows High School (math 49% / reading 46%, grade D, #48 of 381 statewide, top 13%, 1,588 students, 6% FRL) — zoned schools at 7% FRL track the district average.
• Market conditions: 190 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 75% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 36,011 units permitted in Maricopa County in 2024 (12,801 in 5+ unit buildings).
• Maricopa County population projected at +38% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 12y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $290k; list at $475k implies a 64% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: moderate flood risk; moderate wildfire risk; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.2% vs local median 2.5% in Scottsdale — 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.
• This rent runs 32% of the median local income ($152k/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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are A-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?
• 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.