1378 S Avenida Polar Unit L-3

Tucson, AZ 85710

$105,000C-

3 bd · 1.5 ba · 1,150 sqft · Built 1964 · Townhouse · Active · 98 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,512/mo
• Mortgage (P&I): −$551
• Tax + insurance: −$175
• HOA: −$485
• Vac / Maint / Mgmt: −$318
• Net cashflow: $-16/mo
• Annual: $-191/yr
• Cap rate: 6.11%
• Cash-on-cash: -0.65%
• DSCR: 0.97
• 1% rule: 1.44%
• Cash to close: $29,400

Investor read

• This is a 3-bed/1.5-bath townhouse listed at $105k.
• At list price, monthly cash flow is $-16 ($-191/yr) — negative.
• To cash-flow at today's rent, offer at most $103k (2.2% below list).
• Meets the 1% rule at list price ($2k rent vs $105k).
• It's been on market 98 days — a 9% lower offer ($96k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $96k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $726 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#17 in AZ, #4,502 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: health & safety C-, schools D+, crime F.
• Tucson Unified District (4403) (urban): math 14% / reading 23% proficiency, ranked #190 of 249 in AZ (top 76%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: HOA is 32% of rent.
• Market conditions: Rents rising (+1.6%/yr); 210 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; 5,268 units permitted in Pima County in 2024 (996 in 5+ unit buildings).
• Pima County population projected at +8% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts since 21y ago; this cycle's ask has dropped $15k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $57k; list at $105k implies a 84% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 4→11/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.1% vs local median 3.7% in Tucson — 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 32% of the median local income ($57k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 98 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1964 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?