4850 E Desert Cove Ave #241

Phoenix, AZ 85254

$305,000D

2 bd · 2.0 ba · 1,098 sqft · Built 1988 · Condo · Active · 188 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,296/mo
• Mortgage (P&I): −$1,599
• Tax + insurance: −$197
• HOA: −$330
• Vac / Maint / Mgmt: −$482
• Net cashflow: $-312/mo
• Annual: $-3,746/yr
• Cap rate: 5.06%
• Cash-on-cash: -4.39%
• DSCR: 0.80
• 1% rule: 0.75%
• Cash to close: $85,400

Investor read

• This is a 2-bed/2.0-bath condo listed at $305k.
• At list price, monthly cash flow is $-312 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $250k (18.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $230k (24.7% below list).
• It's been on market 188 days — a 12% lower offer ($268k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $230k (24.7% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $9k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#16 in AZ, #3,924 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, housing A+; Watch: health & safety C-, crime F.
• Scottsdale Unified District (4240) (urban): math 53% / reading 55% proficiency, ranked #30 of 249 in AZ (top 12%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Cheyenne Traditional School (math 78% / reading 75%, grade A, #24 of 1,109 statewide, top 2%, 880 students, 4% FRL); Cocopah Middle School (math 63% / reading 63%, grade B+, #3 of 218 statewide, top 1%, 886 students, 9% FRL); Chaparral High School (math 40% / reading 35%, grade F, #82 of 381 statewide, top 22%, 2,038 students, 6% FRL) — zoned schools average 6% FRL vs 21% district-wide (15 pts lower); this property's tenant base skews higher-income than the district average.
• Market conditions: Rents rising (+3.4%/yr); 398 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 36,011 units permitted in Maricopa County in 2024 (12,801 in 5+ unit buildings).
• Maricopa County population projected at +38% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 6 sale attempts since 8y ago; this cycle's ask is 827% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $246k; 24% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: extreme-heat days projected 6→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.1% vs local median 3.3% in Phoenix — 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

• 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 188 days. Have you received any prior offers? Is the seller open to a 25% 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.
• Crime grade is F 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?
• 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?