281 Clay St

Weed, CA 96094

$165,000D

2 bd · 1.0 ba · 855 sqft · Built — · Other · Active · 48 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,329/mo
• Mortgage (P&I): −$865
• Tax + insurance: −$122
• HOA: −$0
• Vac / Maint / Mgmt: −$279
• Net cashflow: $62/mo
• Annual: $746/yr
• Cap rate: 6.75%
• Cash-on-cash: 1.61%
• DSCR: 1.07
• 1% rule: 0.81%
• Cash to close: $46,200

Investor read

• This is a 2-bed/1.0-bath other listed at $165k.
• At list price, monthly cash flow is $62 ($746/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $133k (19.5% below list).
• It's been on market 48 days — a 3% lower offer ($160k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $133k (19.5% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 46/100 on livability (#1,282 in CA) — a working-class tenant base; expect higher turnover. Watch: crime F, amenities F, commute F.
• Weed Union Elementary (town): math 20% / reading 30% proficiency, ranked #1,187 of 1,400 in CA (top 85%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 76% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Weed Elementary (323 students, 78% FRL); Weed High (math 15% / reading 44%, grade F, #723 of 1,170 statewide, top 64%, 195 students, 50% FRL).
• Market conditions: 278 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); 50 units permitted in Siskiyou County in 2024 (0 in 5+ unit buildings).
• Siskiyou County population projected at -26% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $27k; list at $165k implies a 511% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 8→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.7% vs local median 2.7% in Weed — 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.

Questions for listing agent

• It's been on market 48 days. Have you received any prior offers? Is the seller open to a 19% concession, seller financing, or rate buy-down credit?
• 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?
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.