551 Lake Grove Way #165

La Habra, CA 90631

$235,000C+

2 bd · 2.0 ba · 1,248 sqft · Built 1975 · Manufactured · Active · 76 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,871/mo
• Mortgage (P&I): −$1,232
• Tax + insurance: −$392
• HOA: −$0
• Vac / Maint / Mgmt: −$603
• Net cashflow: $644/mo
• Annual: $7,726/yr
• Cap rate: 9.58%
• Cash-on-cash: 11.74%
• DSCR: 1.52
• 1% rule: 1.22%
• Cash to close: $65,800

Investor read

• This is a 2-bed/2.0-bath manufactured listed at $235k. Condition is rated fair.
• At list price, monthly cash flow is $644 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $235k).
• It's been on market 76 days — a 6% lower offer ($221k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $221k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#384 in CA) — a middle-class / working-renter tenant base. Strengths: commute A+, employment A+; Watch: schools D+, crime D+, health & safety D+.
• Fullerton Joint Union High (suburban): math 51% / reading 66% proficiency, ranked #82 of 517 in CA (top 16%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising (+3.4%/yr); 135 active listings in the ZIP; 35 comparable units currently listed for rent nearby; rentals leasing fast (median 2d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 6,974 units permitted in Orange County in 2024 (3,839 in 5+ unit buildings).
• Orange County population projected at +14% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 3 sale attempts since 3y ago 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.
• At projected returns (-3.0% appreciation + 3.4% rent growth), your $66k cash investment doubles in ~10 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 9.6% vs local median 2.1% in La Habra — 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 33% of the median local income ($104k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 76 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1975 — 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 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?
• 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.

Repairs flagged (vision-AI assessment)

• Major: Kitchen cabinets — The cabinets are outdated and need to be replaced.
• Major: Bathroom fixtures — The fixtures are outdated and need to be replaced.
• Major: Flooring — The carpeted flooring is in poor condition and needs to be replaced.