278 Camino Magnifico

Rio Rico, AZ 85648

$239,000D-

3 bd · 2.0 ba · 1,411 sqft · Built 2013 · SingleFamily · Active · 289 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,541/mo
• Mortgage (P&I): −$1,253
• Tax + insurance: −$204
• HOA: −$0
• Vac / Maint / Mgmt: −$324
• Net cashflow: $-241/mo
• Annual: $-2,887/yr
• Cap rate: 5.08%
• Cash-on-cash: -4.31%
• DSCR: 0.81
• 1% rule: 0.64%
• Cash to close: $66,920

Investor read

• This is a 3-bed/2.0-bath single-family listed at $239k.
• At list price, monthly cash flow is $-241 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $196k (17.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $154k (35.5% below list).
• It's been on market 289 days — a 12% lower offer ($210k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $154k (35.5% below list) — sets the bar for 1% rule.
• In year one you build about $26k of equity ($2k loan paydown + $24k appreciation (10.0% local appreciation)).
• Location reads 63/100 on livability (#115 in AZ) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: health & safety C-, employment D+, schools F.
• Santa Cruz Valley Unified District (4458) (town): math 12% / reading 26% proficiency, ranked #184 of 249 in AZ (top 74%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 62% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: 410 active listings in the ZIP; 9 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); 340 units permitted in Santa Cruz County in 2024 (0 in 5+ unit buildings).
• Santa Cruz County population projected at -22% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 12y ago; this cycle's ask has dropped $41k (15%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $125k; list at $239k implies a 91% gain — meaningful room to come down on a strong offer.
• By year 2, paydown + projected appreciation supports a ~$41k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 8→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.1% vs local median 4.1% in Rio Rico — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.
• This rent runs 30% of the median local income ($62k/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 289 days. Have you received any prior offers? Is the seller open to a 36% concession, seller financing, or rate buy-down credit?
• 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 F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.