2104 S Union St

Stockton, CA 95206

$235,950D

2 bd · 1.0 ba · 1,047 sqft · Built 1905 · SingleFamily · Active · 77 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,968/mo
• Mortgage (P&I): −$1,237
• Tax + insurance: −$393
• HOA: −$0
• Vac / Maint / Mgmt: −$413
• Net cashflow: $-76/mo
• Annual: $-907/yr
• Cap rate: 5.91%
• Cash-on-cash: -1.37%
• DSCR: 0.94
• 1% rule: 0.83%
• Cash to close: $66,066

Investor read

• This is a 2-bed/1.0-bath single-family listed at $236k.
• At list price, monthly cash flow is $-76 ($-907/yr) — negative.
• To cash-flow at today's rent, offer at most $225k (4.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $197k (16.6% below list).
• It's been on market 77 days — a 6% lower offer ($222k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $197k (16.6% 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 $7k of value loss. Plan a longer hold.
• Location reads 57/100 on livability (#734 in CA) — a working-class tenant base; expect higher turnover. Strengths: housing A+, health & safety A, amenities A-; Watch: employment C-, crime F, commute F.
• Stockton Unified (urban): math 23% / reading 46% proficiency, ranked #295 of 517 in CA (top 57%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 78% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Alexander Hamilton Elementary (719 students, 85% FRL); Edison High (math 20% / reading 41%, grade F, #710 of 1,170 statewide, top 61%, 2,558 students, 74% FRL) — zoned schools at 79% FRL track the district average.
• Watch-outs: built in 1905 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents soft (-0.6%/yr); 139 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 3,779 units permitted in San Joaquin County in 2024 (0 in 5+ unit buildings).
• San Joaquin County population projected at +17% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: moderate flood risk; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.9% vs local median 3.6% in Stockton — 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 77 days. Have you received any prior offers? Is the seller open to a 17% concession, seller financing, or rate buy-down credit?
• Built in 1905 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• Schools are D-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 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?