522 - 528 S South Dayton St

Tulare, CA 93274

$550,000B-

8 bd · 4.0 ba · 3,300 sqft · Built 1978 · MultiFamily · Pending · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,690/mo
• Mortgage (P&I): −$2,884
• Tax + insurance: −$457
• HOA: −$0
• Vac / Maint / Mgmt: −$1,405
• Net cashflow: $1,944/mo
• Annual: $23,331/yr
• Cap rate: 10.53%
• Cash-on-cash: 15.15%
• DSCR: 1.67
• 1% rule: 1.22%
• Cash to close: $154,000

Investor read

• This is a 4 × 2-bed/1.0-bath units multifamily listed at $550k.
• At list price, monthly cash flow is $2k ($23k/yr) — positive. Per door: $486/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $550k).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• 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 58/100 on livability (#701 in CA) — a working-class tenant base; expect higher turnover. Strengths: housing A+; Watch: commute C-, employment D+, schools D-.
• Tulare Joint Union High (suburban): math 18% / reading 52% proficiency, ranked #280 of 517 in CA (top 54%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising (+2.7%/yr); 355 active listings in the ZIP; 1,447 units permitted in Tulare County in 2024 (307 in 5+ unit buildings).
• Tulare County population projected at +10% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Current owner paid $147k; list at $550k implies a 274% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 2.7% rent growth), your $154k cash investment doubles in ~9 years — after that, you're playing with house money.
• Climate carrying-cost: moderate wildfire risk; extreme-heat days projected 7→18/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.5% vs local median 3.3% in Tulare — 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 $6,690/mo this rent would consume 111% of the median local household income ($73k/yr) (locally 2393% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1978 — 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.
• 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?
• 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.