488 Knight Templar

Paradise Park, CA 95060

$345,000D+

1 bd · 1.0 ba · 642 sqft · Built 1933 · SingleFamily · Active · 36 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,846/mo
• Mortgage (P&I): −$1,809
• Tax + insurance: −$320
• HOA: −$0
• Vac / Maint / Mgmt: −$598
• Net cashflow: $119/mo
• Annual: $1,426/yr
• Cap rate: 6.71%
• Cash-on-cash: 1.48%
• DSCR: 1.07
• 1% rule: 0.82%
• Cash to close: $96,600

Investor read

• This is a 1-bed/1.0-bath single-family listed at $345k.
• At list price, monthly cash flow is $119 ($1k/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 $285k (17.5% below list).
• It's been on market 36 days — a 3% lower offer ($335k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $285k (17.5% 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 $10k of value loss. Plan a longer hold.
• Location reads 75/100 on livability (#109 in CA, #3,842 nationally) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+, health & safety A+; Watch: commute C-, crime D+, amenities F.
• Watch-outs: built in 1933 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.7%/yr); 98 active listings in the ZIP; solid renter incomes; 224 units permitted in Santa Cruz County in 2024 (25 in 5+ unit buildings).
• Santa Cruz County population projected at +18% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts 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.
• Climate carrying-cost: major flood risk — expect insurance premiums to compound above CPI over the hold.
• This rent runs 31% of the median local income ($109k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 36 days. Have you received any prior offers? Is the seller open to a 18% concession, seller financing, or rate buy-down credit?
• Built in 1933 — 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.
• 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.
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.