3005 S Normandie Ave

Los Angeles, CA 90007

$1,270,000B-

10 bd · 8.0 ba · 4,837 sqft · Built 1960 · MultiFamily · Active · 255 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $18,038/mo
• Mortgage (P&I): −$6,660
• Tax + insurance: −$2,083
• HOA: −$0
• Vac / Maint / Mgmt: −$3,788
• Net cashflow: $5,507/mo
• Annual: $66,080/yr
• Cap rate: 11.50%
• Cash-on-cash: 18.58%
• DSCR: 1.83
• 1% rule: 1.42%
• Cash to close: $355,600

Investor read

• This is a 6×1bd/1ba + 2×2bd/1ba units multifamily listed at $1.27M.
• At list price, monthly cash flow is $6k ($66k/yr) — positive. Per door: $688/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($18k rent vs $1.27M).
• It's been on market 255 days — a 12% lower offer ($1.12M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.12M (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $9k of loan paydown is wiped out by about $38k 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-, crime F, cost of living 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.
• Zoned schools: John W. Mack Elementary (287 students, 96% FRL); Manual Arts Senior High (math 12% / reading 22%, grade F, #1,032 of 1,170 statewide, top 88%, 1,026 students, 97% FRL) — zoned schools average 97% FRL vs 67% district-wide (30 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 17% at this address vs 42% district-wide (-24 pts) — the specific schools serving this property underperform the Los Angeles Unified average; the district grade overstates school quality for this exact location.
• Market conditions: Rents rising fast (+5.9%/yr); 86 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 3d on market — plan ~1-2 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 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.
• 11 sale attempts since 9y ago; this cycle's ask is 72679% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• At projected returns (-3.0% appreciation + 5.9% rent growth), your $356k cash investment doubles in ~6 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 11.5% 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 $18,038/mo this rent would consume 612% of the median local household income ($35k/yr) (locally 4179% 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 255 days. Have you received any prior offers? Is the seller open to a 12% 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 1960 — 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?