2528 University Dr

Newport Beach, CA 92660

$1,245,000D

2 bd · 2.0 ba · 1,503 sqft · Built 1963 · SingleFamily · Active · 60 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,491/mo
• Mortgage (P&I): −$6,529
• Tax + insurance: −$1,157
• HOA: −$717
• Vac / Maint / Mgmt: −$1,153
• Net cashflow: $-4,065/mo
• Annual: $-48,782/yr
• Cap rate: 2.37%
• Cash-on-cash: -13.99%
• DSCR: 0.38
• 1% rule: 0.44%
• Cash to close: $348,600

Investor read

• This is a 2-bed/2.0-bath single-family listed at $1.25M.
• At list price, monthly cash flow is $-4k ($-49k/yr) — negative.
• To cash-flow at today's rent, offer at most $527k (57.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $549k (55.9% below list).
• It's been on market 60 days — a 3% lower offer ($1.21M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $527k (57.7% below list) — sets the bar for cash-flow.
• In year one you build about $133k of equity ($9k loan paydown + $124k appreciation (10.0% local appreciation)).
• Location reads 76/100 on livability (#101 in CA, #3,645 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, employment A+, commute A; Watch: health & safety C-, cost of living F.
• Newport-Mesa Unified (urban): math 46% / reading 58% proficiency, ranked #106 of 517 in CA (top 20%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Mariners Elementary (math 68%, 524 students, 20% FRL); Horace Ensign Intermediate (math 49%, 915 students, 48% FRL); Newport Harbor High (math 44% / reading 66%, grade C, #249 of 1,170 statewide, top 22%, 2,268 students, 44% FRL) — zoned schools at 37% FRL track the district average.
• Market conditions: Rents rising fast (+4.1%/yr); 157 active listings in the ZIP; 39 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 6,974 units permitted in Orange County in 2024 (3,839 in 5+ unit buildings).
• Orange County population projected at +14% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 4 sale attempts since 11y 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.
• Current owner paid $585k; list at $1.25M implies a 113% gain — meaningful room to come down on a strong offer.
• By year 2, paydown + projected appreciation supports a ~$214k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 2.4% vs local median 0.6% in Newport Beach — 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 41% of the median local income ($160k/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?
• It's been on market 60 days. Have you received any prior offers? Is the seller open to a 58% concession, seller financing, or rate buy-down credit?
• Built in 1963 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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 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?
• 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.