2942 Sierra St

Riverbank, CA 95367

$2,995,000C+

12 bd · 6.0 ba · 4,404 sqft · Built 1987 · MultiFamily · Pending · 33 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $36,141/mo
• Mortgage (P&I): −$15,706
• Tax + insurance: −$2,812
• HOA: −$0
• Vac / Maint / Mgmt: −$7,590
• Net cashflow: $10,033/mo
• Annual: $120,401/yr
• Cap rate: 10.31%
• Cash-on-cash: 14.36%
• DSCR: 1.64
• 1% rule: 1.21%
• Cash to close: $838,600

Investor read

• This is a 18 × 2-bed/1.0-bath units multifamily listed at $3.00M.
• At list price, monthly cash flow is $10k ($120k/yr) — positive. Per door: $557/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($36k rent vs $3.00M).
• It's been on market 33 days — a 3% lower offer ($2.91M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $2.91M (3.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $21k of loan paydown is wiped out by about $90k of value loss. Plan a longer hold.
• Location reads 57/100 on livability (#757 in CA) — a working-class tenant base; expect higher turnover. Strengths: housing A+, crime B+, employment B; Watch: schools F, amenities D-, commute F.
• Riverbank Unified (suburban): math 16% / reading 32% proficiency, ranked #424 of 517 in CA (top 82%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: 123 active listings in the ZIP; solid renter incomes; 923 units permitted in Stanislaus County in 2024 (63 in 5+ unit buildings).
• Stanislaus County population projected at +14% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• Current owner paid $64k; list at $3.00M implies a 4580% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $839k cash investment doubles in ~9 years — after that, you're playing with house money.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.3% vs local median 3.0% in Riverbank — 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 $36,141/mo this rent would consume 496% of the median local household income ($87k/yr) (locally 615% 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 33 days. Have you received any prior offers? Is the seller open to a 3% 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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.