Residence 1807 Plan

Lake Elsinore, CA 92530

$477,990D

6 bd · 5.0 ba · 1,807 sqft · Built — · MultiFamily · Active · 287 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,811/mo
• Mortgage (P&I): −$2,623
• Tax + insurance: −$834
• HOA: −$0
• Vac / Maint / Mgmt: −$1,010
• Net cashflow: $344/mo
• Annual: $4,133/yr
• Cap rate: 7.12%
• Cash-on-cash: 2.95%
• DSCR: 1.13
• 1% rule: 0.96%
• Cash to close: $140,037

Investor read

• This is a 2 × 3-bed/2.5-bath units multifamily listed at $478k. Condition is rated poor.
• At list price, monthly cash flow is $344 ($4k/yr) — positive. Per door: $172/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($5k rent vs $478k).
• It's been on market 287 days — a 12% lower offer ($421k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $421k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $15k of value loss. Plan a longer hold.
• Location reads 62/100 on livability (#510 in CA) — a middle-class / working-renter tenant base. Strengths: housing A+, crime B, employment B; Watch: amenities D, commute F, cost of living F.
• Lake Elsinore Unified (suburban): math 34% / reading 49% proficiency, ranked #210 of 517 in CA (top 41%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Machado Elementary (math 24% / reading 24%, grade F, #973 of 1,571 statewide, top 73%, 550 students, 90% FRL); Terra Cotta Middle (math 5% / reading 24%, grade F, #461 of 498 statewide, top 93%, 1,094 students, 78% FRL); Lakeside High (reading 74%, 1,748 students, 77% FRL) — zoned schools average 82% FRL vs 48% district-wide (34 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 20% at this address vs 42% district-wide (-22 pts) — the specific schools serving this property underperform the Lake Elsinore Unified average; the district grade overstates school quality for this exact location.
• Market conditions: Rents soft (-0.8%/yr); 458 active listings in the ZIP; solid renter incomes; 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.
• Cap rate 7.1% vs local median 3.3% in Lake Elsinore — 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 $4,811/mo this rent would consume 66% of the median local household income ($87k/yr) (locally 1690% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 287 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• 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?
• 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?

Repairs flagged (vision-AI assessment)

• Major: roof — No visible roof in the satellite image.
• Major: exterior — No visible exterior in the satellite image.
• Major: flooring — No visible flooring in the satellite image.
• Major: interior walls/paint — No visible interior walls/paint in the satellite image.
• Major: systems — No visible systems in the satellite image.