4866 Alterra Way

Sacramento, CA 95835

$499,000D-

2 bd · 2.0 ba · 1,475 sqft · Built 2003 · SingleFamily · Active · 220 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,546/mo
• Mortgage (P&I): −$2,617
• Tax + insurance: −$937
• HOA: −$91
• Vac / Maint / Mgmt: −$535
• Net cashflow: $-1,633/mo
• Annual: $-19,602/yr
• Cap rate: 2.67%
• Cash-on-cash: -12.95%
• DSCR: 0.42
• 1% rule: 0.51%
• Cash to close: $139,720

Investor read

• This is a 2-bed/2.0-bath single-family listed at $499k.
• At list price, monthly cash flow is $-2k ($-20k/yr) — negative.
• To cash-flow at today's rent, offer at most $210k (57.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $255k (49.0% below list).
• It's been on market 220 days — a 12% lower offer ($439k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $210k (57.8% below list) — sets the bar for cash-flow.
• In year one you build about $49k of equity ($3k loan paydown + $46k appreciation (9.2% local appreciation)).
• Location reads 71/100 on livability (#218 in CA) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, housing A; Watch: schools D+, crime F, cost of living F.
• Natomas Unified (urban): math 33% / reading 60% proficiency, ranked #155 of 517 in CA (top 30%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: flood insurance adds $125/mo.
• Market conditions: Rents rising (+1.4%/yr); 402 active listings in the ZIP; 16 comparable units currently listed for rent nearby; rentals leasing fast (median 5d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 6,825 units permitted in Sacramento County in 2024 (1,752 in 5+ unit buildings).
• Sacramento County population projected at +17% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• By year 2, paydown + projected appreciation supports a ~$79k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: in FEMA flood zone A99 (mandatory federal flood insurance); major wildfire risk; extreme-heat days projected 7→14/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

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 220 days. Have you received any prior offers? Is the seller open to a 58% concession, seller financing, or rate buy-down credit?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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?