54880 Inverness Way

La Quinta, CA 92253

$464,000F

2 bd · 2.0 ba · 1,330 sqft · Built 1987 · Condo · Pending · 64 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,336/mo
• Mortgage (P&I): −$2,433
• Tax + insurance: −$698
• HOA: −$806
• Vac / Maint / Mgmt: −$911
• Net cashflow: $-512/mo
• Annual: $-6,147/yr
• Cap rate: 4.97%
• Cash-on-cash: -4.73%
• DSCR: 0.79
• 1% rule: 0.93%
• Cash to close: $129,920

Investor read

• This is a 2-bed/2.0-bath condo listed at $464k.
• At list price, monthly cash flow is $-512 ($-6k/yr) — negative.
• To cash-flow at today's rent, offer at most $374k (19.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $434k (6.6% below list).
• It's been on market 64 days — a 6% lower offer ($436k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $374k (19.5% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $14k of value loss. Plan a longer hold.
• Location reads 58/100 on livability (#694 in CA) — a working-class tenant base; expect higher turnover. Strengths: commute A-, employment B+, housing B+; Watch: schools D, amenities F, cost of living F.
• Coachella Valley Unified (rural): math 12% / reading 23% proficiency, ranked #481 of 517 in CA (top 93%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 79% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising fast (+6.5%/yr); 656 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 70% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• 7 sale attempts since 26y ago; this cycle's ask has dropped $56k (11%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.0% vs local median 3.3% in La Quinta — 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 $4,336/mo this rent would consume 52% of the median local household income ($99k/yr) (locally 1078% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 64 days. Have you received any prior offers? Is the seller open to a 20% 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.
• 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?