2550 Pacific Coast Hwy #256

Torrance, CA 90505

$135,000B+

2 bd · 2.0 ba · 1,440 sqft · Built 1971 · Manufactured · Active · 410 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,398/mo
• Mortgage (P&I): −$708
• Tax + insurance: −$225
• HOA: −$0
• Vac / Maint / Mgmt: −$714
• Net cashflow: $1,751/mo
• Annual: $21,016/yr
• Cap rate: 21.86%
• Cash-on-cash: 55.60%
• DSCR: 3.47
• 1% rule: 2.52%
• Cash to close: $37,800

Investor read

• This is a 2-bed/2.0-bath manufactured listed at $135k.
• At list price, monthly cash flow is $2k ($21k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $135k).
• It's been on market 410 days — a 12% lower offer ($119k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $119k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $933 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#95 in CA, #3,501 nationally) — a middle-class / working-renter tenant base. Strengths: schools A+, amenities A+, commute A+; Watch: health & safety C-, crime D+, cost of living F.
• Los Angeles Unified (urban): math 29% / reading 54% proficiency, ranked #223 of 517 in CA (top 43%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising fast (+4.5%/yr); 63 active listings in the ZIP; 37 comparable units currently listed for rent nearby; rentals at typical pace (median 21d on market — plan ~3-4 weeks tenant-placement turnaround); 41% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 19,697 units permitted in Los Angeles County in 2024 (9,426 in 5+ unit buildings).
• Los Angeles County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 7 sale attempts since 31y ago; this cycle's ask has dropped $94k (41%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 4.5% rent growth), your $38k cash investment doubles in ~3 years — after that, you're playing with house money.
• Cap rate 21.9% vs local median 2.1% in Torrance — 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 35% of the median local income ($116k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 410 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1971 — 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 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 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?
• 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.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.