1023 Mercury

Crestline, CA 92325

$219,900C-

2 bd · 1.0 ba · 816 sqft · Built 1970 · SingleFamily · Active · 64 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,041/mo
• Mortgage (P&I): −$1,153
• Tax + insurance: −$301
• HOA: −$0
• Vac / Maint / Mgmt: −$429
• Net cashflow: $159/mo
• Annual: $1,903/yr
• Cap rate: 7.16%
• Cash-on-cash: 3.09%
• DSCR: 1.14
• 1% rule: 0.93%
• Cash to close: $61,572

Investor read

• This is a 2-bed/1.0-bath single-family listed at $220k.
• At list price, monthly cash flow is $159 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $204k (7.2% below list).
• It's been on market 64 days — a 6% lower offer ($207k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $204k (7.2% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 56/100 on livability (#805 in CA) — a working-class tenant base; expect higher turnover. Strengths: housing A+; Watch: commute D, schools D-, crime F.
• Rim Of The World Unified (town): math 13% / reading 34% proficiency, ranked #415 of 517 in CA (top 80%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Market conditions: Rents rising fast (+4.7%/yr); 252 active listings in the ZIP; 12 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); 5,458 units permitted in San Bernardino County in 2024 (1,500 in 5+ unit buildings).
• San Bernardino County population projected at +15% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Current owner paid $72k; list at $220k implies a 203% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: severe wildfire risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.2% vs local median 3.9% in Crestline — 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 ($71k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 64 days. Have you received any prior offers? Is the seller open to a 7% concession, seller financing, or rate buy-down credit?
• Built in 1970 — 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 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?
• 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?
• 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.