2405 Copper Way

Carlsbad, CA 92009

$1,399,000D-

4 bd · 3.0 ba · 2,196 sqft · Built 2010 · Condo · Pending · 9 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,894/mo
• Mortgage (P&I): −$7,337
• Tax + insurance: −$1,504
• HOA: −$333
• Vac / Maint / Mgmt: −$1,238
• Net cashflow: $-4,517/mo
• Annual: $-54,209/yr
• Cap rate: 2.42%
• Cash-on-cash: -13.84%
• DSCR: 0.38
• 1% rule: 0.42%
• Cash to close: $391,720

Investor read

• This is a 4-bed/3.0-bath condo listed at $1.40M.
• At list price, monthly cash flow is $-5k ($-54k/yr) — negative.
• To cash-flow at today's rent, offer at most $601k (57.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $589k (57.9% below list).
• Only 9 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $589k (57.9% below list) — sets the bar for 1% rule.
• In year one you build about $23k of equity ($10k loan paydown + $14k appreciation (1.0% local appreciation)).
• Location reads 78/100 on livability (#67 in CA, #2,526 nationally) — a middle-class / working-renter tenant base. Strengths: schools A+, amenities A+, commute A+; Watch: health & safety D+, cost of living F.
• Carlsbad Unified (urban): math 68% / reading 76% proficiency, ranked #87 of 1,400 in CA (top 6%) — strong family-tenant draw, lease renewals of 3-5y typical; only 18% free/reduced lunch — higher-income household profile.
• Market conditions: Rents rising fast (+4.9%/yr); 175 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 11,759 units permitted in San Diego County in 2024 (7,244 in 5+ unit buildings).
• San Diego County population projected at +20% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 6y 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 $830k; list at $1.40M implies a 69% gain — meaningful room to come down on a strong offer.
• By year 4, paydown + projected appreciation supports a ~$85k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• This rent runs 43% of the median local income ($164k/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?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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.
• 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.