6225 Cavan Dr #3

Citrus Heights, CA 95621

$177,500D

2 bd · 1.0 ba · 840 sqft · Built 1971 · Condo · Active · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,775/mo
• Mortgage (P&I): −$931
• Tax + insurance: −$143
• HOA: −$335
• Vac / Maint / Mgmt: −$373
• Net cashflow: $-7/mo
• Annual: $-81/yr
• Cap rate: 6.25%
• Cash-on-cash: -0.16%
• DSCR: 0.99
• 1% rule: 1.00%
• Cash to close: $49,700

Investor read

• This is a 2-bed/1.0-bath condo listed at $178k.
• At list price, monthly cash flow is $-7 ($-81/yr) — negative.
• To cash-flow at today's rent, offer at most $176k (0.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $177k (0.0% below list).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $176k (0.7% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 60/100 on livability (#614 in CA) — a middle-class / working-renter tenant base. Strengths: housing A+; Watch: crime D-, amenities F, commute F.
• San Juan Unified (suburban): math 40% / reading 62% proficiency, ranked #138 of 517 in CA (top 27%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Orangevale Open K-8 (572 students, 22% FRL); Sylvan Middle (647 students, 71% FRL); El Camino Fundamental High (math 34% / reading 62%, grade D, #378 of 1,170 statewide, top 32%, 1,246 students, 50% FRL) — zoned schools at 48% FRL track the district average.
• Market conditions: Rents rising (+1.9%/yr); 219 active listings in the ZIP; 32 comparable units currently listed for rent nearby; rentals at typical pace (median 18d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 6,825 units permitted in Sacramento County in 2024 (1,752 in 5+ unit buildings).
• Sacramento County population projected at +17% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Current owner paid $56k; list at $178k implies a 217% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→16/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.2% vs local median 3.4% in Citrus Heights — 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.

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?
• Built in 1971 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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 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?