72985 Somera Rd

Palm Desert, CA 92260

$289,000B-

4 bd · 4.0 ba · 3,163 sqft · Built 2021 · SingleFamily · Active · 27 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,447/mo
• Mortgage (P&I): −$1,516
• Tax + insurance: −$482
• HOA: −$0
• Vac / Maint / Mgmt: −$1,564
• Net cashflow: $3,886/mo
• Annual: $46,633/yr
• Cap rate: 22.43%
• Cash-on-cash: 57.63%
• DSCR: 3.56
• 1% rule: 2.58%
• Cash to close: $80,920

Investor read

• This is a 4-bed/4.0-bath single-family listed at $289k.
• At list price, monthly cash flow is $4k ($47k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $289k).
• It's been on market 27 days — a 2% lower offer ($285k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $285k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $9k of value loss. Plan a longer hold.
• Location reads 51/100 on livability (#1,050 in CA) — a working-class tenant base; expect higher turnover. Strengths: schools A-, employment B+, housing B; Watch: crime D, amenities F, commute F.
• Desert Sands Unified (suburban): math 31% / reading 56% proficiency, ranked #199 of 517 in CA (top 38%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising (+1.6%/yr); 545 active listings in the ZIP; 21 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 62% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• 12 sale attempts since 5y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• At projected returns (-3.0% appreciation + 1.6% rent growth), your $81k cash investment doubles in ~2 years — after that, you're playing with house money.
• Climate carrying-cost: moderate wildfire risk; extreme-heat days projected 8→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 22.4% vs local median 3.5% in Palm Desert — 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 $7,447/mo this rent would consume 127% of the median local household income ($70k/yr) (locally 1734% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• 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?
• Crime grade is D 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?
• 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.