1307 E Peck St

Compton, CA 90221

$1,850,000C+

5 bd · 5.0 ba · 2,508 sqft · Built 1950 · MultiFamily · Active · 73 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $21,823/mo
• Mortgage (P&I): −$9,702
• Tax + insurance: −$2,016
• HOA: −$0
• Vac / Maint / Mgmt: −$4,583
• Net cashflow: $5,523/mo
• Annual: $66,271/yr
• Cap rate: 9.88%
• Cash-on-cash: 12.79%
• DSCR: 1.57
• 1% rule: 1.18%
• Cash to close: $518,000

Investor read

• This is a 10 × 14-bed/10.0-bath units multifamily listed at $1.85M.
• At list price, monthly cash flow is $6k ($66k/yr) — positive. Per door: $552/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($22k rent vs $1.85M).
• It's been on market 73 days — a 6% lower offer ($1.74M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.74M (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $13k of loan paydown is wiped out by about $56k of value loss. Plan a longer hold.
• Location reads 56/100 on livability (#803 in CA) — a working-class tenant base; expect higher turnover. Strengths: commute A+, housing B; Watch: schools D, crime F, amenities D-.
• Compton Unified (suburban): math 31% / reading 38% proficiency, ranked #910 of 1,400 in CA (top 65%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 78% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 40 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 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 26y 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 $1.50M; 23% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $518k cash investment doubles in ~9 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 9.9% vs local median 3.0% in Compton — 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.

Questions for listing agent

• It's been on market 73 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 1950 — 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?