2232 42nd Ave SE #205

Salem, OR 97317

$84,500C+

2 bd · 2.0 ba · 1,344 sqft · Built 1973 · Manufactured · Active · 186 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,717/mo
• Mortgage (P&I): −$443
• Tax + insurance: −$90
• HOA: −$0
• Vac / Maint / Mgmt: −$360
• Net cashflow: $823/mo
• Annual: $9,878/yr
• Cap rate: 17.98%
• Cash-on-cash: 41.75%
• DSCR: 2.86
• 1% rule: 2.03%
• Cash to close: $23,660

Investor read

• This is a 2-bed/2.0-bath manufactured listed at $84k.
• At list price, monthly cash flow is $823 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $84k).
• It's been on market 186 days — a 12% lower offer ($74k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $74k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $584 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 79/100 on livability (#59 in OR, #2,084 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, housing A+; Watch: schools D, crime F.
• Salem-Keizer SD 24J (urban): math 34% / reading 47% proficiency, ranked #103 of 183 in OR (top 56%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising (+2.6%/yr); 133 active listings in the ZIP; 19 comparable units currently listed for rent nearby; rentals leasing fast (median 14d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 1,591 units permitted in Marion County in 2024 (716 in 5+ unit buildings).
• Marion County population projected at +17% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 16y ago; this cycle's ask has dropped $4k (5%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $14k; list at $84k implies a 504% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 2.6% rent growth), your $24k cash investment doubles in ~3 years — after that, you're playing with house money.
• Cap rate 18.0% vs local median 2.9% in Salem — 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 186 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1973 — 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 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.
• 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.