1518 7th Ave

Oakland, CA 94606

$429,000D+

4 bd · 2.0 ba · 1,364 sqft · Built 1895 · MultiFamily · Active · 25 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,915/mo
• Mortgage (P&I): −$2,250
• Tax + insurance: −$774
• HOA: −$0
• Vac / Maint / Mgmt: −$822
• Net cashflow: $69/mo
• Annual: $827/yr
• Cap rate: 6.49%
• Cash-on-cash: 0.69%
• DSCR: 1.03
• 1% rule: 0.91%
• Cash to close: $120,120

Investor read

• This is a 4-bed/2.0-bath multifamily listed at $429k.
• At list price, monthly cash flow is $69 ($827/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $392k (8.7% below list).
• It's been on market 25 days — a 2% lower offer ($423k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $392k (8.7% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $13k of value loss. Plan a longer hold.
• Location reads 71/100 on livability (#224 in CA) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, employment A+; Watch: crime F, cost of living F.
• Oakland Unified (urban): math 27% / reading 33% proficiency, ranked #1,007 of 1,400 in CA (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Franklin Elementary (496 students, 94% FRL); Roosevelt Middle (593 students, 95% FRL); Oakland High (1,531 students, 88% FRL) — zoned schools average 92% FRL vs 68% district-wide (24 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1895 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.9%/yr); 127 active listings in the ZIP; 27 comparable units currently listed for rent nearby; rentals leasing fast (median 4d on market — plan ~1-2 weeks tenant-placement turnaround); 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.
• 3 sale attempts since 4y 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 $350k; 23% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 6.5% vs local median 2.5% in Oakland — 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 $3,915/mo this rent would consume 65% of the median local household income ($72k/yr) (locally 3757% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1895 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.
• 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.
• How much new apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.