349 Pointing Rock Dr

Borrego Springs, CA 92004

$415,000C+

2 bd · 2.0 ba · 1,613 sqft · Built 1972 · SingleFamily · Active · 172 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,310/mo
• Mortgage (P&I): −$2,176
• Tax + insurance: −$630
• HOA: −$0
• Vac / Maint / Mgmt: −$905
• Net cashflow: $598/mo
• Annual: $7,181/yr
• Cap rate: 8.39%
• Cash-on-cash: 7.47%
• DSCR: 1.33
• 1% rule: 1.04%
• Cash to close: $116,200

Investor read

• This is a 2-bed/2.0-bath single-family listed at $415k.
• At list price, monthly cash flow is $598 ($7k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($4k rent vs $415k).
• It's been on market 172 days — a 12% lower offer ($365k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $365k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 58/100 on livability (#712 in CA) — a working-class tenant base; expect higher turnover. Strengths: crime A+, employment A+, housing A+; Watch: schools F, amenities F, commute F.
• Borrego Springs Unified (rural): math 20% / reading 35% proficiency, ranked #1,120 of 1,400 in CA (top 80%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 72% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: flood insurance adds $125/mo.
• Market conditions: 174 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 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.
• 8 sale attempts since 19y ago; this cycle's ask has dropped $30k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $255k; list at $415k implies a 63% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: in FEMA flood zone A (mandatory federal flood insurance); extreme-heat days projected 9→27/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.4% vs local median 6.0% in Borrego Springs — 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 172 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1972 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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 F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.