2400 Donovan Ave #40

Bellingham, WA 98225

$90,000B-

2 bd · 1.0 ba · 784 sqft · Built 1978 · Manufactured · Pending · 68 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,042/mo
• Mortgage (P&I): −$472
• Tax + insurance: −$150
• HOA: −$0
• Vac / Maint / Mgmt: −$429
• Net cashflow: $991/mo
• Annual: $11,895/yr
• Cap rate: 19.51%
• Cash-on-cash: 47.20%
• DSCR: 3.10
• 1% rule: 2.27%
• Cash to close: $25,200

Investor read

• This is a 2-bed/1.0-bath manufactured listed at $90k.
• At list price, monthly cash flow is $991 ($12k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $90k).
• It's been on market 68 days — a 6% lower offer ($85k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $85k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $622 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 80/100 on livability (#102 in WA, #1,947 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, health & safety A+; Watch: crime F, cost of living F.
• Bellingham School District (urban): math 47% / reading 63% proficiency, ranked #106 of 291 in WA (top 36%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising (+2.7%/yr); 241 active listings in the ZIP; 26 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); 1,190 units permitted in Whatcom County in 2024 (327 in 5+ unit buildings).
• Whatcom County population projected at +28% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• At projected returns (-3.0% appreciation + 2.7% rent growth), your $25k cash investment doubles in ~3 years — after that, you're playing with house money.
• Cap rate 19.5% vs local median 2.0% in Bellingham — 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.
• This rent runs 38% of the median local income ($64k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 68 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Built in 1978 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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 B-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?
• 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?
• 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.