65 Palomar Real #65

Campbell, CA 95008

$450,000D

2 bd · 2.0 ba · 1,399 sqft · Built 1965 · Manufactured · Active · 45 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,599/mo
• Mortgage (P&I): −$2,360
• Tax + insurance: −$750
• HOA: −$0
• Vac / Maint / Mgmt: −$756
• Net cashflow: $-267/mo
• Annual: $-3,200/yr
• Cap rate: 5.58%
• Cash-on-cash: -2.54%
• DSCR: 0.89
• 1% rule: 0.80%
• Cash to close: $126,000

Investor read

• This is a 2-bed/2.0-bath manufactured listed at $450k.
• At list price, monthly cash flow is $-267 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $411k (8.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $360k (20.0% below list).
• It's been on market 45 days — a 3% lower offer ($436k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $360k (20.0% below list) — sets the bar for 1% rule.
• Local home prices are declining (-1.4%/yr); year-one equity from $3k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 80/100 on livability (#46 in CA, #1,724 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, employment A+; Watch: crime F, cost of living F.
• Campbell Union High (urban): math 56% / reading 75% proficiency, ranked #55 of 517 in CA (top 11%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Bagby Elementary (483 students, 15% FRL); Price Charter Middle (math 24% / reading 24%, grade F, #277 of 498 statewide, top 73%, 870 students, 18% FRL, charter); Branham High (math 61% / reading 82%, grade B+, #101 of 1,170 statewide, top 9%, 1,990 students, 30% FRL).
• Zoned-school proficiency averages 48% at this address vs 66% district-wide (-18 pts) — the specific schools serving this property underperform the Campbell Union High average; the district grade overstates school quality for this exact location.
• Market conditions: Rents rising (+2.4%/yr); 118 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals leasing fast (median 1d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 3,838 units permitted in Santa Clara County in 2024 (1,886 in 5+ unit buildings).
• Santa Clara County population projected at +24% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 14y 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 $230k; list at $450k implies a 96% gain — meaningful room to come down on a strong offer.
• Cap rate 5.6% vs local median 0.7% in Campbell — 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 31% of the median local income ($141k/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 45 days. Have you received any prior offers? Is the seller open to a 20% concession, seller financing, or rate buy-down credit?
• Built in 1965 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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?
• 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.