Airbnb Investment Analysis: 1844 East Alvarado Street, Fallbrook, CA

Weak · financed

Priced too high to cash-flow with a loan — an equity or tax play, not income.

1844 East Alvarado Street

Fallbrook, CA

3bd · 2ba · 8 guests

Purchase price

Zestimate® $827,600

Est. monthly payment$4,130/mo

Break-even price$534.0K

Vs 5 comps nearby#2 of 6

$57.9K$92.3K

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Investment potential

Your scenario · adjust the levers below or open advanced settings to see how returns change

Projected annual revenue

$66,971

$5,581/mo · at 55% occupancy & $385/night

Cash-flow negative

-$17,580

-$1,465/mo after costs & mortgage

Cap rate

3.9%

Cash-on-cash

-7.5%

DSCR

0.65

Confidence

48%

Your assumptions

Revenue

$66,971/yr

Market avg: $66,971/yr · 55% occ · $385 ADR

Occupancy

mkt

Avg daily rate

mkt

Days available

Financing

$49,554/yr

Down payment

Interest rate

Mortgage term

Operating costs

$34,996/yr

Property management

Airbnb fee

Property tax

Insurance

Utilities

Market Context

How this property compares to similar short-term rentals nearby.

Comparable set · 5 properties

Daily rate

$318–$492

Median $353

Occupancy

31%–81%

Median 52%

Annual revenue

$57.9K–$92.3K

Median $60.5K

Days available

243–359

Median 335

Revenue floor · $57.9KTop performer · $92.3K

This property · $67.0K

Comparable properties (5)

Cash flow potential Low · Appreciation potential Medium

RevenueOccupancyDaily rate

Hacienda El Nido Spa, PoolTop performer

317 days available · 257 days booked ·

Annual revenue

$92,331

Occupancy

81%

Daily rate

$353

Serene Guest House on Avocado Grove and Vineyard

346 days available · 180 days booked ·

Annual revenue

$64,318

Occupancy

52%

Daily rate

$318

French Farmhouse Retreat

335 days available · 141 days booked ·

Annual revenue

$60,473

Occupancy

42%

Daily rate

$422

The Retreat - close to lots of venues

359 days available · 111 days booked ·

Annual revenue

$59,840

Occupancy

31%

Daily rate

$492

Custom Home, Pool, View, Orchard, Private, Pets ok

243 days available · 163 days booked ·

Annual revenue

$57,894

Occupancy

67%

Daily rate

$340

Revenue and occupancy reflect Chalet's modeled estimates from observed booking activity for comparable active listings. Individual results vary with management, seasonality, and pricing.

Who this property is for

Three ways this deal works — and who each one fits

The same property is a great buy for one investor and a trap for another. Here's the honest read.

Best fit

1031 / high-equity buyer

~$204.4K

Year-1 tax shield

Buying with cash or low leverage removes the debt-coverage problem entirely, so the thesis rests on appreciation plus a large first-year write-off. At roughly 25% of purchase price, the shield is substantial enough to carry the deal on its own.

Not a fit

Price-disciplined buyer

$534.0K

Break-even purchase price

Break-even is ~35% below the Zestimate, a discount sellers in Fallbrook rarely accept. Treat the number as a walk-away line rather than an opening offer.

Not a fit

DSCR cash-flow buyer

0.65

DSCR at asking

At asking price the property doesn't cover its own debt service, so it won't qualify for DSCR financing as modeled. If you need cash flow from day one, look at a mid-term-rental fallback or a different Fallbrook submarket.

Year-one tax shield estimate

For a buyer who materially participates and qualifies for the STR tax treatment.

$204.4K

Estimated first-year deduction · range $169.7K–$233.0K

Purchase price: $827,600
Land allocation (excluded): −$289,660
Depreciable basis: $537,940
Cost-seg accelerated: $161,382
+ Bonus depreciation & furnishings: $43,035

Why this matters here

At a marginal bracket, this deduction can be worth $62.8K–$86.2K in estimated federal tax saved.

This only applies if you meet the IRS material-participation tests for short-term rentals and are not using a full-service property manager.

Estimate, subject to CPA review. Cost-segregation percentages shown here are illustrative and depend on an actual study of the property.

California does not conform to federal bonus depreciation, so your state tax treatment will differ from the federal figures above.

Chalet can introduce a cost-segregation partner — this is not tax, legal, or financial advice.

Price sensitivity & break-even

How cash-on-cash return moves with purchase price. The marked line is break-even (1.0 DSCR).

Purchase price$827,600 (+0.0% vs asking)

At this price: cash-on-cash -7.5%, DSCR 0.65, cash flow -$17,580/yr

Cash-on-cash return by purchase price
Price vs asking	Price	Cash-on-cash	DSCR	Band
-25%	$620,700	-2.9%	0.86	Below break-even
-22%	$645,528	-3.6%	0.83	Below break-even
-15%	$703,460	-5.0%	0.76	Below break-even
-8%	$761,392	-6.2%	0.70	Below break-even
Asking	$827,600	-7.5%	0.65	Below break-even
+8%	$893,808	-8.5%	0.60	Below break-even
+15%	$951,740	-9.4%	0.56	Below break-even

Below break-evenAt break-evenPositive

Break-even price

$534,006

~35% under Zestimate. Where this property reaches 1.0 DSCR and neutral cash flow.

Discount needed

−$293,594

The gap between asking and the price a cash-flow buyer can underwrite.

If refi to 5.5% in 24 mo

+$7,263/yr

Illustrative cash-flow improvement at asking price if rates fall. Planning figure, not a forecast.

Gross revenue$66,971

Booking & management fees−$8,706

Airbnb fee (3%)$2,009

Property mgmt (10%)$6,697

Net revenue

$58,265

Property operating costs−$26,290

Insurance, utilities & maintenance$18,014

Property tax (est.)$8,276

Net operating income (NOI)Before mortgage · 48% margin

$31,975

Debt service (mortgage)−$49,554

Annual cash flow−$17,580

−$1,465/mo after all expenses

Cash to close

Down payment, closing costs, and furnishing

$240,004

Return on cash:9.9%

Down payment

25% of purchase price

$206,900

Closing costs

1% of purchase price

$8,276

Furnishing budget

3BR · est. 3% of purchase price

$24,828

DSCR below 1.0 — but you can still qualify

Your DSCR is 0.65 · lenders typically require 1.0+.

01.0 threshold2.0+

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Return & exit scenario

What the deal returns over the hold — including the tax shield, which is the whole point for an appreciation buyer.

Levered IRR

11.7%

over 5-yr hold, with tax shield

Equity multiple

1.7×

total proceeds vs. $240,004 invested

Projected value at exit

$1,056,251

year 5 · 5.0% annual appreciation

Tax shield contribution

+6.3 pts

of IRR comes from year-1 depreciation

Equity builtAppreciationCumulative cash flow (negative — drag below baseline)

Projected investment value by year
Year	Equity	Appreciation	Cumulative cash flow	Total value
Year 1	$213,205	$41,380	$58,054	$312,639
Year 2	$219,966	$84,829	$40,690	$345,485
Year 3	$227,216	$130,450	$23,533	$381,200
Year 4	$234,989	$178,353	$6,575	$419,917
Year 5	$243,325	$228,651	-$10,195	$461,780

Projection, not a promise.

Assumes 5.0% annual appreciation, 1.5% rent growth (operating costs held flat), and that the property qualifies for short-term-rental tax treatment. The year-1 depreciation shield depends on a real cost-segregation study and your tax situation — consult a CPA.

Appreciation is the dominant driver of this return. When cash flow is negative, the deal depends on the property gaining value — it is not paying for itself from income.

Appreciation, rent growth, and financing rates are editable under Edit financials.

Get a Fallbrook STR agent who understands this deal.

STR deals turn on local rules and demand that a generalist agent misses. Chalet matches you with a vetted Fallbrook agent who knows which properties actually cash flow — and which to avoid.

Vetted STR specialistsFree to investorsNo obligation

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Disclaimer. This page and the data presented are for informational purposes only. The information provided should not be construed as financial, legal, or investment advice. Market conditions can change rapidly, and past performance does not guarantee future results. Always consult with qualified professionals before making investment decisions.

TOOLS & CALCULATORS

LEARNING & RESOURCES

SERVICES & PARTNERS

MARKET INSIGHTS

Three ways this deal works — and who each one fits

Year-one tax shield estimate

Price sensitivity & break-even

Return & exit scenario

Get a Fallbrook STR agent who understands this deal.

Popular Airbnb Investment Opportunities Near This Property (Analyzed by Chalet Users)

Popular Airbnb Investment Opportunities Near This Property (Analyzed by Chalet Users)