221 E Big Bear

Big Bear City, CA 92314

$499,999C-

9 bd · 21.0 ba · 1,306 sqft · Built 1950 · MultiFamily · Active · 99 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,871/mo
• Mortgage (P&I): −$2,622
• Tax + insurance: −$589
• HOA: −$0
• Vac / Maint / Mgmt: −$1,233
• Net cashflow: $1,428/mo
• Annual: $17,130/yr
• Cap rate: 9.72%
• Cash-on-cash: 12.24%
• DSCR: 1.54
• 1% rule: 1.17%
• Cash to close: $140,000

Investor read

• This is a 3 × 3-bed/7.0-bath units multifamily listed at $500k.
• At list price, monthly cash flow is $1k ($17k/yr) — positive. Per door: $476/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($6k rent vs $500k).
• It's been on market 99 days — a 9% lower offer ($455k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $455k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $15k of value loss. Plan a longer hold.
• Location reads 52/100 on livability (#988 in CA) — a working-class tenant base; expect higher turnover. Strengths: housing B; Watch: schools D+, crime F, amenities F.
• Bear Valley Unified (town): math 26% / reading 43% proficiency, ranked #289 of 517 in CA (top 56%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 451 active listings in the ZIP; 5,458 units permitted in San Bernardino County in 2024 (1,500 in 5+ unit buildings).
• San Bernardino County population projected at +15% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Current owner paid $399k; 25% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $140k cash investment doubles in ~10 years — after that, you're playing with house money.
• Climate carrying-cost: major wildfire risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 9.7% vs local median 3.3% in Big Bear City — 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 $5,871/mo this rent would consume 94% of the median local household income ($75k/yr) (locally 203% 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 99 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 1950 — 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?