26329 N Babbling Brook Dr

Phoenix, AZ 85083

$420,000D-

3 bd · 3.0 ba · 1,661 sqft · Built 2007 · SingleFamily · Active · 83 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,655/mo
• Mortgage (P&I): −$2,203
• Tax + insurance: −$324
• HOA: −$258
• Vac / Maint / Mgmt: −$558
• Net cashflow: $-687/mo
• Annual: $-8,247/yr
• Cap rate: 4.33%
• Cash-on-cash: -7.01%
• DSCR: 0.69
• 1% rule: 0.63%
• Cash to close: $117,600

Investor read

• This is a 3-bed/3.0-bath single-family listed at $420k.
• At list price, monthly cash flow is $-687 ($-8k/yr) — negative.
• To cash-flow at today's rent, offer at most $299k (28.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $266k (36.8% below list).
• It's been on market 83 days — a 6% lower offer ($395k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $266k (36.8% below list) — sets the bar for 1% rule.
• In year one you build about $45k of equity ($3k loan paydown + $42k appreciation (10.0% local appreciation)).
• Location reads 75/100 on livability (#16 in AZ, #3,924 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, housing A+; Watch: health & safety C-, crime F.
• Deer Valley Unified District (4246) (urban): math 50% / reading 55% proficiency, ranked #33 of 249 in AZ (top 13%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising (+2.3%/yr); 118 active listings in the ZIP; 16 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• 3 sale attempts since 9y ago; this cycle's ask has dropped $30k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• By year 2, paydown + projected appreciation supports a ~$72k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: moderate wildfire risk; extreme-heat days projected 6→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.3% vs local median 3.3% in Phoenix — 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.

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 83 days. Have you received any prior offers? Is the seller open to a 37% 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?
• 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.
• 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?
• 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.