12398 Hwy 99 E

Red Bluff, CA 96080

$640,000C

12 bd · 6.0 ba · — sqft · Built 1948 · MultiFamily · Active · 106 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,180/mo
• Mortgage (P&I): −$3,356
• Tax + insurance: −$1,067
• HOA: −$0
• Vac / Maint / Mgmt: −$1,508
• Net cashflow: $1,249/mo
• Annual: $14,992/yr
• Cap rate: 8.64%
• Cash-on-cash: 8.37%
• DSCR: 1.37
• 1% rule: 1.12%
• Cash to close: $179,200

Investor read

• This is a 4 × 3-bed/1.5-bath units multifamily listed at $640k.
• At list price, monthly cash flow is $1k ($15k/yr) — positive. Per door: $312/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $640k).
• It's been on market 106 days — a 9% lower offer ($582k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $582k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $19k of value loss. Plan a longer hold.
• Location reads 58/100 on livability (#698 in CA) — a working-class tenant base; expect higher turnover. Strengths: health & safety A+, housing A-; Watch: cost of living D, crime F, amenities F.
• Lassen View Union Elementary (rural): math 47% / reading 56% proficiency, ranked #142 of 517 in CA (top 28%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: built in 1948 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents flat; 262 active listings in the ZIP; 186 units permitted in Tehama County in 2024 (0 in 5+ unit buildings).
• Tehama County population projected at -14% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Cap rate 8.6% vs local median 3.7% in Red Bluff — 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.
• At $7,180/mo this rent would consume 130% of the median local household income ($66k/yr) (locally 981% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 106 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1948 — 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.
• 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.