78431 Magenta Dr

La Quinta, CA 92253

$284,000D

1 bd · 2.0 ba · 763 sqft · Built 1998 · Condo · Active · 40 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,547/mo
• Mortgage (P&I): −$1,489
• Tax + insurance: −$330
• HOA: −$575
• Vac / Maint / Mgmt: −$535
• Net cashflow: $-382/mo
• Annual: $-4,580/yr
• Cap rate: 4.68%
• Cash-on-cash: -5.76%
• DSCR: 0.74
• 1% rule: 0.90%
• Cash to close: $79,520

Investor read

• This is a 1-bed/2.0-bath condo listed at $284k.
• At list price, monthly cash flow is $-382 ($-5k/yr) — negative.
• To cash-flow at today's rent, offer at most $217k (23.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $255k (10.3% below list).
• It's been on market 40 days — a 3% lower offer ($275k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $217k (23.7% below list) — sets the bar for cash-flow.
• 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 58/100 on livability (#694 in CA) — a working-class tenant base; expect higher turnover. Strengths: commute A-, employment B+, housing B+; Watch: amenities F, cost of living F, health & safety 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.
• Zoned schools: Gerald R. Ford Elementary (math 24% / reading 24%, grade F, #973 of 1,571 statewide, top 73%, 603 students, 59% FRL); John Glenn Middle School of International Studies (math 10% / reading 10%, grade F, #474 of 498 statewide, top 99%, 1,045 students, 64% FRL); La Quinta High (math 31% / reading 65%, grade D, #380 of 1,170 statewide, top 33%, 2,500 students, 74% FRL).
• Zoned-school proficiency averages 28% at this address vs 44% district-wide (-16 pts) — the specific schools serving this property underperform the Desert Sands Unified average; the district grade overstates school quality for this exact location.
• Watch-outs: HOA is 23% of rent.
• Market conditions: Rents rising fast (+6.5%/yr); 660 active listings in the ZIP; 30 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• 12 sale attempts since 28y 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 $149k; list at $284k implies a 91% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: moderate wildfire risk; extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.7% 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.

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 40 days. Have you received any prior offers? Is the seller open to a 24% 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?
• 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?
• 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.