20701 Beach #103

Huntington Beach, CA 92648

$160,900B-

3 bd · 2.0 ba · 1,120 sqft · Built 1972 · Manufactured · Active · 3 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,173/mo
• Mortgage (P&I): −$844
• Tax + insurance: −$268
• HOA: −$0
• Vac / Maint / Mgmt: −$876
• Net cashflow: $2,185/mo
• Annual: $26,218/yr
• Cap rate: 22.59%
• Cash-on-cash: 58.20%
• DSCR: 3.59
• 1% rule: 2.59%
• Cash to close: $45,052

Investor read

• This is a 3-bed/2.0-bath manufactured listed at $161k.
• At list price, monthly cash flow is $2k ($26k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($4k rent vs $161k).
• Only 3 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 67/100 on livability (#306 in CA) — a middle-class / working-renter tenant base. Strengths: employment A+, commute A-, schools B+; Watch: amenities C-, cost of living F, health & safety F.
• Huntington Beach Union High (suburban): math 65% / reading 82% proficiency, ranked #39 of 517 in CA (top 8%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Market conditions: Rents rising (+2.8%/yr); 135 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals leasing fast (median 2d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 6,974 units permitted in Orange County in 2024 (3,839 in 5+ unit buildings).
• Orange County population projected at +14% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts; this cycle's ask has dropped $9k (5%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 2.8% rent growth), your $45k cash investment doubles in ~2 years — after that, you're playing with house money.
• Cap rate 22.6% vs local median 1.6% in Huntington Beach — 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 38% of the median local income ($130k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1972 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-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?
• 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.