71400 Gardess Rd

Rancho Mirage, CA 92270

$849,999C-

4 bd · 2.0 ba · 2,018 sqft · Built 1967 · SingleFamily · Pending · 23 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,330/mo
• Mortgage (P&I): −$4,457
• Tax + insurance: −$666
• HOA: −$0
• Vac / Maint / Mgmt: −$1,539
• Net cashflow: $667/mo
• Annual: $8,003/yr
• Cap rate: 7.23%
• Cash-on-cash: 3.36%
• DSCR: 1.15
• 1% rule: 0.86%
• Cash to close: $238,000

Investor read

• This is a 4-bed/2.0-bath single-family listed at $850k.
• At list price, monthly cash flow is $667 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $733k (13.8% below list).
• It's been on market 23 days — a 2% lower offer ($837k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $733k (13.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $6k of loan paydown is wiped out by about $26k of value loss. Plan a longer hold.
• Location reads 51/100 on livability (#1,065 in CA) — a working-class tenant base; expect higher turnover. Strengths: employment A+; Watch: amenities F, commute F, cost of living F.
• Palm Springs Unified (suburban): math 21% / reading 42% proficiency, ranked #328 of 517 in CA (top 63%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 73% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising (+3.7%/yr); 532 active listings in the ZIP; 16 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 62% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 9,195 units permitted in Riverside County in 2024 (1,512 in 5+ unit buildings).
• Riverside County population projected at +22% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Current owner paid $169k; list at $850k implies a 403% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: moderate wildfire risk; extreme-heat days projected 8→24/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.2% vs local median 3.0% in Rancho Mirage — 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 $7,330/mo this rent would consume 82% of the median local household income ($107k/yr) (locally 498% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1967 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.