1195 W SPRING St

Highgrove, CA 92507

$885,000D

8 bd · 5.0 ba · 3,264 sqft · Built 1962 · MultiFamily · Active · 142 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,788/mo
• Mortgage (P&I): −$4,641
• Tax + insurance: −$891
• HOA: −$0
• Vac / Maint / Mgmt: −$1,425
• Net cashflow: $-169/mo
• Annual: $-2,028/yr
• Cap rate: 6.06%
• Cash-on-cash: -0.82%
• DSCR: 0.96
• 1% rule: 0.77%
• Cash to close: $247,800

Investor read

• This is a 2 × 4-bed/?-bath units multifamily listed at $885k.
• At list price, monthly cash flow is $-169 ($-2k/yr) — negative. Per door: $-85/mo.
• To cash-flow at today's rent, offer at most $855k (3.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $679k (23.3% below list).
• It's been on market 142 days — a 12% lower offer ($779k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $679k (23.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $6k of loan paydown is wiped out by about $27k of value loss. Plan a longer hold.
• Location reads 49/100 on livability (#1,172 in CA) — a working-class tenant base; expect higher turnover. Strengths: housing A, employment A-; Watch: crime C-, schools F, amenities F.
• Riverside Unified (urban): math 36% / reading 51% proficiency, ranked #574 of 1,400 in CA (top 41%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents flat; 156 active listings in the ZIP; solid renter incomes; 9,195 units permitted in Riverside County in 2024 (1,512 in 5+ unit buildings).
• Riverside County population projected at +22% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 13 sale attempts since 21y ago; this cycle's ask has dropped $80k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $498k; list at $885k implies a 78% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.1% vs local median 3.1% in Highgrove — 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.
• At $6,788/mo this rent would consume 108% of the median local household income ($75k/yr) (locally 3590% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 142 days. Have you received any prior offers? Is the seller open to a 23% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1962 — 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 F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?