54529 Tanglewood

La Quinta, CA 92253

$434,500D+

2 bd · 2.0 ba · 1,283 sqft · Built 1988 · Condo · Active · 90 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,512/mo
• Mortgage (P&I): −$2,279
• Tax + insurance: −$560
• HOA: −$802
• Vac / Maint / Mgmt: −$948
• Net cashflow: $-76/mo
• Annual: $-914/yr
• Cap rate: 6.08%
• Cash-on-cash: -0.75%
• DSCR: 0.97
• 1% rule: 1.04%
• Cash to close: $121,660

Investor read

• This is a 2-bed/2.0-bath condo listed at $434k.
• At list price, monthly cash flow is $-76 ($-914/yr) — negative.
• To cash-flow at today's rent, offer at most $421k (3.1% below list).
• Meets the 1% rule at list price ($5k rent vs $434k).
• It's been on market 90 days — a 6% lower offer ($408k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $408k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $13k of value loss. Plan a longer hold.
• Location reads 58/100 on livability (#694 in CA) — a working-class tenant base; expect higher turnover. Strengths: commute A-, employment B+, housing B+; Watch: schools D, amenities F, cost of living F.
• Desert Sands Unified (suburban): math 31% / reading 56% proficiency, ranked #199 of 517 in CA (top 38%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising fast (+6.5%/yr); 656 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 70% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• 10 sale attempts since 26y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $270k; list at $434k implies a 61% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.1% vs local median 3.3% in La Quinta — 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 $4,512/mo this rent would consume 55% of the median local household income ($99k/yr) (locally 1078% 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 90 days. Have you received any prior offers? Is the seller open to a 6% 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.
• 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?
• 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?