1535 Julia St

Berkeley, CA 94703

$1,198,000C

7 bd · 6.0 ba · 3,499 sqft · Built 1919 · MultiFamily · Active · 111 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $12,318/mo
• Mortgage (P&I): −$6,282
• Tax + insurance: −$2,527
• HOA: −$0
• Vac / Maint / Mgmt: −$2,587
• Net cashflow: $921/mo
• Annual: $11,057/yr
• Cap rate: 7.22%
• Cash-on-cash: 3.30%
• DSCR: 1.15
• 1% rule: 1.03%
• Cash to close: $335,440

Investor read

• This is a 7-bed/6.0-bath multifamily listed at $1.20M.
• At list price, monthly cash flow is $921 ($11k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($12k rent vs $1.20M).
• It's been on market 111 days — a 9% lower offer ($1.09M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.09M (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $8k of loan paydown is wiped out by about $36k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#74 in CA, #2,860 nationally) — a middle-class / working-renter tenant base. Strengths: schools A+, amenities A+, commute A+; Watch: crime F, cost of living F.
• Berkeley Unified (urban): math 61% / reading 67% proficiency, ranked #175 of 1,400 in CA (top 12%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: built in 1919 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.1%/yr); 53 active listings in the ZIP; 2 comparable units currently listed for rent nearby; solid renter incomes; 1,742 units permitted in Alameda County in 2024 (856 in 5+ unit buildings).
• Alameda County population projected at +34% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 8 sale attempts since 22y ago; this cycle's ask has dropped $92k (7%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: moderate flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.2% vs local median 2.0% in Berkeley — 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 $12,318/mo this rent would consume 135% of the median local household income ($110k/yr) (locally 1402% 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 111 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1919 — 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 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?
• 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.