The Wedge Sky Valley Plan

Sky Valley, CA 92241

$105,900B

1 bd · 1.0 ba · 400 sqft · Built — · Manufactured · Active · 611 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,301/mo
• Mortgage (P&I): −$232
• Tax + insurance: −$74
• HOA: −$0
• Vac / Maint / Mgmt: −$273
• Net cashflow: $721/mo
• Annual: $8,655/yr
• Cap rate: 25.82%
• Cash-on-cash: 69.72%
• DSCR: 4.10
• 1% rule: 2.93%
• Cash to close: $12,414

Investor read

• This is a 1-bed/1.0-bath manufactured listed at $106k. Condition is rated excellent.
• At list price, monthly cash flow is $721 ($9k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $106k).
• It's been on market 611 days — a 12% lower offer ($93k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $93k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $307 of loan paydown is wiped out by about $1k of value loss. Plan a longer hold.
• Location reads 52/100 on livability (#1,041 in CA) — a working-class tenant base; expect higher turnover. Strengths: housing A; Watch: schools F, amenities F, commute F.
• Palm Springs Unified (suburban): math 21% / reading 42% proficiency, ranked #328 of 517 in CA (top 63%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 73% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: 216 active listings in the ZIP; 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 (-3.0% appreciation + 3.0% rent growth), your $12k cash investment doubles in ~2 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 25.8% vs local median 9.6% in Sky 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.

Questions for listing agent

• It's been on market 611 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• 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?
• 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.