8600 Contreras St #35

Paramount, CA 90723

$140,000B-

2 bd · 2.0 ba · 960 sqft · Built 1978 · Manufactured · Active · 94 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,506/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$83
• HOA: −$0
• Vac / Maint / Mgmt: −$526
• Net cashflow: $1,162/mo
• Annual: $13,945/yr
• Cap rate: 16.25%
• Cash-on-cash: 35.57%
• DSCR: 2.58
• 1% rule: 1.79%
• Cash to close: $39,200

Investor read

• This is a 2-bed/2.0-bath manufactured listed at $140k.
• At list price, monthly cash flow is $1k ($14k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $140k).
• It's been on market 94 days — a 9% lower offer ($127k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $127k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $968 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#432 in CA) — a middle-class / working-renter tenant base. Strengths: commute A+; Watch: schools D, crime F, amenities F.
• Paramount Unified (suburban): math 15% / reading 34% proficiency, ranked #416 of 517 in CA (top 80%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 76% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents soft (-1.0%/yr); 51 active listings in the ZIP; 35 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 19,697 units permitted in Los Angeles County in 2024 (9,426 in 5+ unit buildings).
• Los Angeles County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 4 sale attempts since 21y ago; this cycle's ask has dropped $10k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $40k; list at $140k implies a 250% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 0.0% rent growth), your $39k cash investment doubles in ~4 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 6→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 16.3% vs local median 3.2% in Paramount — 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 40% of the median local income ($75k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 94 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1978 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.