11771 Upland Way

Desert Hot Springs, CA 92240

$890,000B-

None bd · None ba · 3,200 sqft · Built 2024 · MultiFamily · Active · 41 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $11,947/mo
• Mortgage (P&I): −$4,667
• Tax + insurance: −$1,406
• HOA: −$0
• Vac / Maint / Mgmt: −$2,509
• Net cashflow: $3,365/mo
• Annual: $40,378/yr
• Cap rate: 10.83%
• Cash-on-cash: 16.20%
• DSCR: 1.72
• 1% rule: 1.34%
• Cash to close: $249,200

Investor read

• This is a 1×4bd/1ba + 2×1bd/1ba + 4×2bd/1ba units multifamily listed at $890k.
• At list price, monthly cash flow is $3k ($40k/yr) — positive. Per door: $481/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($12k rent vs $890k).
• It's been on market 41 days — a 3% lower offer ($863k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $863k (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $6k of loan paydown is wiped out by about $27k of value loss. Plan a longer hold.
• Location reads 49/100 on livability (#1,149 in CA) — a working-class tenant base; expect higher turnover. Strengths: housing B+; Watch: crime D+, schools F, amenities 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: Rents rising (+3.7%/yr); 515 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 67% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• 2 sale attempts 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 $26k; list at $890k implies a 3323% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.7% rent growth), your $249k cash investment doubles in ~7 years — after that, you're playing with house money.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.8% vs local median 4.0% in Desert Hot Springs — 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 $11,947/mo this rent would consume 265% of the median local household income ($54k/yr) (locally 2095% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 41 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• 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?
• 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.