324 N Palm Dr #204

Beverly Hills, CA 90210

$1,395,000D-

3 bd · 2.0 ba · 1,766 sqft · Built 1980 · Condo · Active · 3 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $8,621/mo
• Mortgage (P&I): −$7,316
• Tax + insurance: −$1,816
• HOA: −$1,178
• Vac / Maint / Mgmt: −$1,811
• Net cashflow: $-3,499/mo
• Annual: $-41,983/yr
• Cap rate: 3.28%
• Cash-on-cash: -10.75%
• DSCR: 0.52
• 1% rule: 0.62%
• Cash to close: $390,600

Investor read

• This is a 3-bed/2.0-bath condo listed at $1.40M.
• At list price, monthly cash flow is $-3k ($-42k/yr) — negative.
• To cash-flow at today's rent, offer at most $985k (29.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $862k (38.2% below list).
• Only 3 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $862k (38.2% below list) — sets the bar for 1% rule.
• In year one you build about $143k of equity ($10k loan paydown + $133k appreciation (9.6% local appreciation)).
• Location reads 74/100 on livability (#138 in CA, #4,810 nationally) — a middle-class / working-renter tenant base. Strengths: schools A+, amenities A+, commute A+; Watch: housing C-, health & safety C-, crime F.
• Beverly Hills Unified (suburban): math 57% / reading 73% proficiency, ranked #61 of 517 in CA (top 12%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 7% free/reduced lunch — higher-income household profile.
• Market conditions: Rents rising (+1.7%/yr); 308 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 48% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 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.
• 4 sale attempts since 29y 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 $1.15M; 21% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• By year 2, paydown + projected appreciation supports a ~$230k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• At $8,621/mo this rent would consume 55% of the median local household income ($188k/yr) (locally 911% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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?
• 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?
• 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?
• 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.