7930 SE 34th St #203

Mercer Island, WA 98040

$508,000D-

2 bd · 1.0 ba · 1,029 sqft · Built 1981 · Condo · Active · 59 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,882/mo
• Mortgage (P&I): −$2,664
• Tax + insurance: −$509
• HOA: −$766
• Vac / Maint / Mgmt: −$605
• Net cashflow: $-1,663/mo
• Annual: $-19,953/yr
• Cap rate: 2.37%
• Cash-on-cash: -14.03%
• DSCR: 0.38
• 1% rule: 0.57%
• Cash to close: $142,240

Investor read

• This is a 2-bed/1.0-bath condo listed at $508k.
• At list price, monthly cash flow is $-2k ($-20k/yr) — negative.
• To cash-flow at today's rent, offer at most $214k (57.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $288k (43.3% below list).
• It's been on market 59 days — a 3% lower offer ($493k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $214k (57.8% below list) — sets the bar for cash-flow.
• In year one you build about $2k of equity ($4k loan paydown + $-1k appreciation (-0.2% local appreciation)).
• Location reads 76/100 on livability (#154 in WA, #3,481 nationally) — a middle-class / working-renter tenant base. Strengths: schools A+, crime A+, commute A+; Watch: amenities F, cost of living F, health & safety F.
• Mercer Island School District (suburban): math 83% / reading 87% proficiency, ranked #1 of 291 in WA (top 0%) — strong family-tenant draw, lease renewals of 3-5y typical; only 3% free/reduced lunch — higher-income household profile.
• Watch-outs: HOA is 27% of rent.
• Market conditions: Rents flat; 128 active listings in the ZIP; 20 comparable units currently listed for rent nearby; rentals leasing fast (median 0d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 10,555 units permitted in King County in 2024 (7,119 in 5+ unit buildings).
• King County population projected at +44% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 3y 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 $214k; list at $508k implies a 137% gain — meaningful room to come down on a strong offer.
• By year 9, paydown + projected appreciation supports a ~$35k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 2.4% vs local median 1.1% in Mercer Island — 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.
• This rent is only 16% of the median local income ($219k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 59 days. Have you received any prior offers? Is the seller open to a 58% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• 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.