1987 Gearhart Green Dr #704

Gearhart, OR 97138

$120,000C-

2 bd · 2.0 ba · 1,069 sqft · Built 1992 · Condo · Pending · 110 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,766/mo
• Mortgage (P&I): −$629
• Tax + insurance: −$295
• HOA: −$500
• Vac / Maint / Mgmt: −$371
• Net cashflow: $-29/mo
• Annual: $-349/yr
• Cap rate: 6.00%
• Cash-on-cash: -1.04%
• DSCR: 0.95
• 1% rule: 1.47%
• Cash to close: $33,600

Investor read

• This is a 2-bed/2.0-bath condo listed at $120k.
• At list price, monthly cash flow is $-29 ($-349/yr) — negative.
• To cash-flow at today's rent, offer at most $115k (4.3% below list).
• Meets the 1% rule at list price ($2k rent vs $120k).
• It's been on market 110 days — a 9% lower offer ($109k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $109k (9.0% below list) — sets the bar for market timing.
• In year one you build about $13k of equity ($830 loan paydown + $12k appreciation (10.0% local appreciation)).
• Location reads 82/100 on livability (#48 in OR, #1,279 nationally) — a professional / high-income tenant draw. Strengths: crime A+, employment A+, housing A+; Watch: schools C-, amenities F, cost of living F.
• Seaside SD 10 (town): math 11% / reading 41% proficiency, ranked #53 of 58 in OR (top 91%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: HOA is 28% of rent.
• Market conditions: 226 active listings in the ZIP; 98 units permitted in Clatsop County in 2024 (0 in 5+ unit buildings).
• 2 sale attempts; this cycle's ask has dropped $10k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $34k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 3, paydown + projected appreciation supports a ~$32k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 6.0% vs local median 1.0% in Gearhart — 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 35% of the median local income ($60k/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 110 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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.
• 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.