5890 E Highway 20 #9

Lucerne, CA 95458

$42,000C+

2 bd · 1.5 ba · 720 sqft · Built 1971 · Manufactured · Active · 115 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,367/mo
• Mortgage (P&I): −$220
• Tax + insurance: −$70
• HOA: −$0
• Vac / Maint / Mgmt: −$287
• Net cashflow: $790/mo
• Annual: $9,478/yr
• Cap rate: 28.86%
• Cash-on-cash: 80.60%
• DSCR: 4.59
• 1% rule: 3.26%
• Cash to close: $11,760

Investor read

• This is a 2-bed/1.5-bath manufactured listed at $42k. Condition is rated average.
• At list price, monthly cash flow is $790 ($9k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $42k).
• It's been on market 115 days — a 9% lower offer ($38k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $38k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-1.1%/yr); year-one equity from $290 of loan paydown is wiped out by about $471 of value loss. Plan a longer hold.
• Location reads 59/100 on livability (#656 in CA) — a working-class tenant base; expect higher turnover. Strengths: housing A+, crime A-; Watch: health & safety C-, employment D+, schools F.
• Lucerne Elementary (town): math 20% / reading 25% proficiency, ranked #1,228 of 1,400 in CA (top 88%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 74% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: 80 active listings in the ZIP; 107 units permitted in Lake County in 2024 (40 in 5+ unit buildings).
• Lake County population projected at -15% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• At projected returns (-1.1% appreciation + 3.0% rent growth), your $12k cash investment doubles in ~2 years — after that, you're playing with house money.
• Climate carrying-cost: severe wildfire risk; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 28.9% vs local median 3.4% in Lucerne — 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

• It's been on market 115 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1971 — 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 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?
• 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.

Repairs flagged (vision-AI assessment)

• Minor: Kitchen cabinets — The kitchen cabinets appear to be in good condition with no visible damage.
• Minor: Bathroom — The bathroom appears to be in good condition with no visible damage.
• Minor: Exterior siding — The exterior siding appears to be in good condition with no visible damage.
• Minor: Flooring — The flooring appears to be in good condition with no visible damage.
• Minor: Interior walls — The interior walls appear to be in good condition with no visible damage.
• Minor: HVAC system — The HVAC system appears to be in good condition with no visible damage.