20802 N Grayhawk Dr #1087

Scottsdale, AZ 85255

$825,000D

3 bd · 4.0 ba · 2,267 sqft · Built 1997 · Condo · Active · 47 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,116/mo
• Mortgage (P&I): −$4,326
• Tax + insurance: −$670
• HOA: −$638
• Vac / Maint / Mgmt: −$1,284
• Net cashflow: $-803/mo
• Annual: $-9,631/yr
• Cap rate: 5.13%
• Cash-on-cash: -4.17%
• DSCR: 0.81
• 1% rule: 0.74%
• Cash to close: $231,000

Investor read

• This is a 3-bed/4.0-bath condo listed at $825k.
• At list price, monthly cash flow is $-803 ($-10k/yr) — negative.
• To cash-flow at today's rent, offer at most $683k (17.2% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $612k (25.9% below list).
• It's been on market 47 days — a 3% lower offer ($800k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $612k (25.9% below list) — sets the bar for 1% rule.
• In year one you build about $52k of equity ($6k loan paydown + $47k appreciation (5.6% local appreciation)).
• Location reads 80/100 on livability (#4 in AZ, #1,756 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, employment A+; Watch: health & safety C-, cost of living F.
• Paradise Valley Unified District (4241) (urban): math 39% / reading 46% proficiency, ranked #56 of 249 in AZ (top 22%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising fast (+4.4%/yr); 720 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 55% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 36,011 units permitted in Maricopa County in 2024 (12,801 in 5+ unit buildings).
• Maricopa County population projected at +38% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 8 sale attempts since 20y ago; this cycle's ask is 20525% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $675k; 22% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• By year 2, paydown + projected appreciation supports a ~$84k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.1% vs local median 2.5% in Scottsdale — 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 $6,116/mo this rent would consume 52% of the median local household income ($141k/yr) (locally 1034% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 47 days. Have you received any prior offers? Is the seller open to a 26% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• 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.