201 Five Cities #133

Pismo Beach, CA 93449

$385,000D

2 bd · 1.0 ba · 1,100 sqft · Built 1975 · Manufactured · Active · 57 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,986/mo
• Mortgage (P&I): −$2,019
• Tax + insurance: −$642
• HOA: −$0
• Vac / Maint / Mgmt: −$627
• Net cashflow: $-301/mo
• Annual: $-3,616/yr
• Cap rate: 5.35%
• Cash-on-cash: -3.35%
• DSCR: 0.85
• 1% rule: 0.78%
• Cash to close: $107,800

Investor read

• This is a 2-bed/1.0-bath manufactured listed at $385k.
• At list price, monthly cash flow is $-301 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $341k (11.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $299k (22.4% below list).
• It's been on market 57 days — a 3% lower offer ($373k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $299k (22.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#229 in CA) — a middle-class / working-renter tenant base. Strengths: employment A+, health & safety A+, amenities B; Watch: crime D+, commute F, cost of living F.
• Lucia Mar Unified (town): math 42% / reading 56% proficiency, ranked #433 of 1,400 in CA (top 31%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Shell Beach Elementary (325 students, 38% FRL); Judkins Middle (458 students, 64% FRL); Arroyo Grande High (1,991 students, 48% FRL).
• Market conditions: Rents rising fast (+9.2%/yr); 58 active listings in the ZIP; 12 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 1,104 units permitted in San Luis Obispo County in 2024 (273 in 5+ unit buildings).
• San Luis Obispo County population projected at +20% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 19y 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 $105k; list at $385k implies a 267% gain — meaningful room to come down on a strong offer.
• Cap rate 5.4% vs local median 1.1% in Pismo Beach — 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 30% of the median local income ($118k/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 57 days. Have you received any prior offers? Is the seller open to a 22% concession, seller financing, or rate buy-down credit?
• Built in 1975 — 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 B-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 D 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.