144 Holm Rd #119

Watsonville, CA 95076

$329,000D+

2 bd · 2.0 ba · 1,725 sqft · Built 1978 · Manufactured · Active · 97 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,079/mo
• Mortgage (P&I): −$1,725
• Tax + insurance: −$548
• HOA: −$550
• Vac / Maint / Mgmt: −$647
• Net cashflow: $-391/mo
• Annual: $-4,693/yr
• Cap rate: 4.87%
• Cash-on-cash: -5.09%
• DSCR: 0.77
• 1% rule: 0.94%
• Cash to close: $92,120

Investor read

• This is a 2-bed/2.0-bath manufactured listed at $329k.
• At list price, monthly cash flow is $-391 ($-5k/yr) — negative.
• To cash-flow at today's rent, offer at most $272k (17.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $308k (6.4% below list).
• It's been on market 97 days — a 9% lower offer ($299k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $272k (17.2% below list) — sets the bar for cash-flow.
• 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 67/100 on livability (#323 in CA) — a middle-class / working-renter tenant base. Strengths: commute A+, health & safety A+; Watch: amenities D-, cost of living F.
• Pajaro Valley Unified (urban): math 75% / reading 75% proficiency, ranked #43 of 517 in CA (top 8%) — strong family-tenant draw, lease renewals of 3-5y typical; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Mar Vista Elementary (344 students, 58% FRL); Rolling Hills Middle (619 students, 96% FRL); Pajaro Valley High (1,489 students, 93% FRL) — zoned schools average 82% FRL vs 67% district-wide (15 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising fast (+6.6%/yr); 122 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals at typical pace (median 16d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• 7 sale attempts since 27y ago; this cycle's ask has dropped $49k (13%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $145k; list at $329k implies a 127% gain — meaningful room to come down on a strong offer.
• Cap rate 4.9% vs local median 2.8% in Watsonville — 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 41% of the median local income ($91k/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 97 days. Have you received any prior offers? Is the seller open to a 17% concession, seller financing, or rate buy-down credit?
• Built in 1978 — 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?
• 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?
• 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?