510 E 23rd St

Los Angeles, CA 90011

$999,000B-

6 bd · 6.0 ba · 6,936 sqft · Built 1907 · MultiFamily · Active · 83 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $24,857/mo
• Mortgage (P&I): −$5,239
• Tax + insurance: −$986
• HOA: −$0
• Vac / Maint / Mgmt: −$5,220
• Net cashflow: $13,413/mo
• Annual: $160,951/yr
• Cap rate: 22.40%
• Cash-on-cash: 57.54%
• DSCR: 3.56
• 1% rule: 2.49%
• Cash to close: $279,720

Investor read

• This is a 12 × 1-bed/1-bath units multifamily listed at $999k.
• At list price, monthly cash flow is $13k ($161k/yr) — positive. Per door: $1k/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($25k rent vs $999k).
• It's been on market 83 days — a 6% lower offer ($939k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $939k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $7k of loan paydown is wiped out by about $30k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#273 in CA) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, employment B; Watch: health & safety C-, schools D+, crime F.
• Los Angeles Unified (urban): math 29% / reading 54% proficiency, ranked #223 of 517 in CA (top 43%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1907 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents falling (-8.2%/yr); 126 active listings in the ZIP; 19,697 units permitted in Los Angeles County in 2024 (9,426 in 5+ unit buildings).
• Los Angeles County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 12 sale attempts since 19y ago; this cycle's ask is 74% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $350k; list at $999k implies a 185% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 0.0% rent growth), your $280k cash investment doubles in ~3 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 22.4% vs local median 2.1% in Los Angeles — 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 $24,857/mo this rent would consume 505% of the median local household income ($59k/yr) (locally 5930% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 83 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• 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 1907 — 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 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?