7438 E Hum Rd #101

Carefree, AZ 85377

$629,000D-

3 bd · 3.0 ba · 2,016 sqft · Built 1980 · Condo · Pending · 171 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,550/mo
• Mortgage (P&I): −$3,299
• Tax + insurance: −$1,048
• HOA: −$394
• Vac / Maint / Mgmt: −$956
• Net cashflow: $-1,146/mo
• Annual: $-13,754/yr
• Cap rate: 4.11%
• Cash-on-cash: -7.81%
• DSCR: 0.65
• 1% rule: 0.72%
• Cash to close: $176,120

Investor read

• This is a 3-bed/3.0-bath condo listed at $629k.
• At list price, monthly cash flow is $-1k ($-14k/yr) — negative.
• To cash-flow at today's rent, offer at most $463k (26.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $455k (27.7% below list).
• It's been on market 171 days — a 12% lower offer ($554k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $455k (27.7% below list) — sets the bar for 1% rule.
• In year one you build about $43k of equity ($4k loan paydown + $39k appreciation (6.1% local appreciation)).
• Location reads 68/100 on livability (#58 in AZ) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+; Watch: amenities D+, health & safety D+, commute F.
• Cave Creek Unified District (4244) (urban): math 57% / reading 59% proficiency, ranked #13 of 249 in AZ (top 5%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 8% free/reduced lunch — higher-income household profile.
• Zoned schools: Black Mountain Elementary School (math 66% / reading 63%, grade B, #104 of 1,109 statewide, top 10%, 495 students, 8% FRL); Sonoran Trails Middle School (math 48% / reading 50%, grade C-, #31 of 218 statewide, top 14%, 761 students, 7% FRL); Cactus Shadows High School (math 49% / reading 46%, grade D, #48 of 381 statewide, top 13%, 1,588 students, 6% FRL) — zoned schools at 7% FRL track the district average.
• Market conditions: 101 active listings in the ZIP; 18 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 72% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• 9 sale attempts since 23y 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 $205k; list at $629k implies a 207% gain — meaningful room to come down on a strong offer.
• By year 2, paydown + projected appreciation supports a ~$69k 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 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

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 171 days. Have you received any prior offers? Is the seller open to a 28% 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?
• 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?
• 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.
• 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.