1640 Southpointe Dr

Yuba City, CA 95991

$300,000D+

5 bd · 3.0 ba · 2,590 sqft · Built 1997 · SingleFamily · Pending · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,822/mo
• Mortgage (P&I): −$1,573
• Tax + insurance: −$633
• HOA: −$0
• Vac / Maint / Mgmt: −$593
• Net cashflow: $23/mo
• Annual: $276/yr
• Cap rate: 6.38%
• Cash-on-cash: 0.33%
• DSCR: 1.01
• 1% rule: 0.94%
• Cash to close: $84,000

Investor read

• This is a 5-bed/3.0-bath single-family listed at $300k.
• At list price, monthly cash flow is $23 ($276/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $282k (5.9% below list).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $282k (5.9% 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 $9k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#111 in CA, #3,863 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, housing A+, health & safety A+; Watch: crime D+, cost of living F.
• Yuba City Unified (urban): math 20% / reading 53% proficiency, ranked #263 of 517 in CA (top 51%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Riverbend Elementary (968 students, 71% FRL); Gray Avenue Middle (688 students, 89% FRL); Yuba City High (math 19% / reading 54%, grade F, #602 of 1,170 statewide, top 52%, 1,822 students, 64% FRL) — zoned schools average 75% FRL vs 58% district-wide (17 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising (+1.8%/yr); 149 active listings in the ZIP; 5 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; 73 units permitted in Sutter County in 2024 (0 in 5+ unit buildings).
• Sutter County population projected to shrink 4% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.4% vs local median 3.5% in Yuba City — 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 $2,822/mo this rent would consume 48% of the median local household income ($71k/yr) (locally 1674% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• 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?
• 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?
• 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.