735 Garden Ct

Molalla, OR 97038

$400,000D

3 bd · 2.5 ba · 1,680 sqft · Built 2015 · SingleFamily · Active · 13 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,007/mo
• Mortgage (P&I): −$2,098
• Tax + insurance: −$478
• HOA: −$4
• Vac / Maint / Mgmt: −$631
• Net cashflow: $-205/mo
• Annual: $-2,458/yr
• Cap rate: 5.68%
• Cash-on-cash: -2.19%
• DSCR: 0.90
• 1% rule: 0.75%
• Cash to close: $112,000

Investor read

• This is a 3-bed/2.5-bath single-family listed at $400k.
• At list price, monthly cash flow is $-205 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $364k (9.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $301k (24.8% below list).
• Only 13 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $301k (24.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 79/100 on livability (#62 in OR, #2,293 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, housing A+, health & safety A+; Watch: cost of living C-, amenities F.
• Molalla River SD 35 (town): math 21% / reading 43% proficiency, ranked #32 of 58 in OR (top 55%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Molalla River Academy (math 34% / reading 54%, grade F, #143 of 412 statewide, top 38%, 202 students, 18% FRL, charter); Molalla River Middle School (math 15% / reading 41%, grade F, #95 of 128 statewide, top 74%, 532 students, 33% FRL); Molalla High School (math 27% / reading 52%, grade F, #78 of 143 statewide, top 58%, 763 students, 32% FRL).
• Market conditions: 109 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 0d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 946 units permitted in Clackamas County in 2024 (188 in 5+ unit buildings).
• Clackamas County population projected at +25% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 10y 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.
• Climate carrying-cost: major wildfire risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.7% vs local median 2.7% in Molalla — 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 ($90k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?
• 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.
• 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.