142 Liberty

Newport Beach, CA 92660

$689,000D+

2 bd · 2.0 ba · 1,300 sqft · Built 1961 · Manufactured · Active · 52 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,877/mo
• Mortgage (P&I): −$3,613
• Tax + insurance: −$1,148
• HOA: −$0
• Vac / Maint / Mgmt: −$1,234
• Net cashflow: $-119/mo
• Annual: $-1,425/yr
• Cap rate: 6.09%
• Cash-on-cash: -0.74%
• DSCR: 0.97
• 1% rule: 0.85%
• Cash to close: $192,920

Investor read

• This is a 2-bed/2.0-bath manufactured listed at $689k.
• At list price, monthly cash flow is $-119 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $672k (2.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $588k (14.7% below list).
• It's been on market 52 days — a 3% lower offer ($668k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $588k (14.7% below list) — sets the bar for 1% rule.
• In year one you build about $74k of equity ($5k loan paydown + $69k appreciation (10.0% local appreciation)).
• Location reads 76/100 on livability (#101 in CA, #3,645 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, employment A+, commute A; Watch: health & safety C-, cost of living F.
• Newport-Mesa Unified (urban): math 46% / reading 58% proficiency, ranked #106 of 517 in CA (top 20%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Abraham Lincoln Elementary (math 67%, 306 students, 32% FRL); Corona Del Mar High (math 55% / reading 63%, grade C+, #221 of 1,170 statewide, top 19%, 2,059 students, 20% FRL).
• Market conditions: Rents rising fast (+4.1%/yr); 157 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 52% of comp listings sitting > 30 days — soft ceiling on asking rent; 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 since 22y ago; this cycle's ask has dropped $50k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• By year 2, paydown + projected appreciation supports a ~$118k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.1% vs local median 0.6% in Newport 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 44% of the median local income ($160k/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?
• It's been on market 52 days. Have you received any prior offers? Is the seller open to a 15% concession, seller financing, or rate buy-down credit?
• Built in 1961 — 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 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.