323 N Soto St

Los Angeles, CA 90033

$4,000,000B-

80 bd · 1600.0 ba · 10,364 sqft · Built 1929 · MultiFamily · Active · 114 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $82,708/mo
• Mortgage (P&I): −$20,976
• Tax + insurance: −$4,279
• HOA: −$0
• Vac / Maint / Mgmt: −$17,369
• Net cashflow: $40,084/mo
• Annual: $481,006/yr
• Cap rate: 18.32%
• Cash-on-cash: 42.95%
• DSCR: 2.91
• 1% rule: 2.07%
• Cash to close: $1,120,000

Investor read

• This is a 40 × 2-bed/1-bath units multifamily listed at $4.00M.
• At list price, monthly cash flow is $40k ($481k/yr) — positive. Per door: $1k/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($83k rent vs $4.00M).
• It's been on market 114 days — a 9% lower offer ($3.64M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $3.64M (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $28k of loan paydown is wiped out by about $120k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#273 in CA) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, employment B; Watch: health & safety C-, schools D+, crime F.
• Los Angeles Unified (urban): math 29% / reading 54% proficiency, ranked #223 of 517 in CA (top 43%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1929 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents soft (-2.3%/yr); 108 active listings in the ZIP; 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.
• 8 sale attempts since 22y 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 $2.50M; list at $4.00M implies a 60% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 0.0% rent growth), your $1.12M cash investment doubles in ~3 years — after that, you're playing with house money.
• Cap rate 18.3% vs local median 2.1% in Los Angeles — 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 $82,708/mo this rent would consume 1664% of the median local household income ($60k/yr) (locally 3159% 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 114 days. Have you received any prior offers? Is the seller open to a 9% 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 1929 — 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?