1016 N Pearl St

Centralia, WA 98531

$548,000D-

4 bd · 4.0 ba · 2,248 sqft · Built 1900 · MultiFamily · Active · 42 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,010/mo
• Mortgage (P&I): −$2,874
• Tax + insurance: −$655
• HOA: −$0
• Vac / Maint / Mgmt: −$842
• Net cashflow: $-361/mo
• Annual: $-4,336/yr
• Cap rate: 5.50%
• Cash-on-cash: -2.83%
• DSCR: 0.87
• 1% rule: 0.73%
• Cash to close: $153,440

Investor read

• This is a 4-bed/4.0-bath multifamily listed at $548k.
• At list price, monthly cash flow is $-361 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $484k (11.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $401k (26.8% below list).
• It's been on market 42 days — a 3% lower offer ($532k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $401k (26.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $16k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#81 in WA, #1,497 nationally) — a professional / high-income tenant draw. Strengths: commute A+, health & safety A+, cost of living A; Watch: crime C-, employment F.
• Centralia School District (town): math 39% / reading 52% proficiency, ranked #187 of 291 in WA (top 64%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 65% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Edison Elementary (281 students, 75% FRL); Centralia High School (986 students, 70% FRL).
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+3.0%/yr); 258 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 265 units permitted in Lewis County in 2024 (44 in 5+ unit buildings).
• Lewis County population projected at -11% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 3 sale attempts since 10y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Current owner paid $55k; list at $548k implies a 896% gain — meaningful room to come down on a strong offer.
• Cap rate 5.5% vs local median 3.0% in Centralia — 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 $4,010/mo this rent would consume 76% of the median local household income ($63k/yr) (locally 1000% 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 42 days. Have you received any prior offers? Is the seller open to a 27% concession, seller financing, or rate buy-down credit?
• Built in 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.