601 Ayers St

Kelso, WA 98626

$369,000C-

5 bd · 3.0 ba · 2,460 sqft · Built 1910 · MultiFamily · Active · 67 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,303/mo
• Mortgage (P&I): −$1,935
• Tax + insurance: −$393
• HOA: −$0
• Vac / Maint / Mgmt: −$694
• Net cashflow: $281/mo
• Annual: $3,373/yr
• Cap rate: 7.21%
• Cash-on-cash: 3.26%
• DSCR: 1.15
• 1% rule: 0.90%
• Cash to close: $103,320

Investor read

• This is a 1×3.0bd/1.5ba + 1×2.0bd/1.0ba units multifamily listed at $369k.
• At list price, monthly cash flow is $281 ($3k/yr) — positive. Per door: $141/mo.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $330k (10.5% below list).
• It's been on market 67 days — a 6% lower offer ($347k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $330k (10.5% 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 $11k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#324 in WA) — a middle-class / working-renter tenant base. Strengths: housing A+, cost of living A-; Watch: health & safety C-, schools D-, amenities F.
• Kelso School District (suburban): math 35% / reading 53% proficiency, ranked #191 of 291 in WA (top 66%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1910 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+4.1%/yr); 217 active listings in the ZIP; solid renter incomes; 348 units permitted in Cowlitz County in 2024 (40 in 5+ unit buildings).
• Cowlitz County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 2 sale attempts since 7y 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 $225k; list at $369k implies a 64% gain — meaningful room to come down on a strong offer.
• Cap rate 7.2% vs local median 3.4% in Kelso — 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 $3,303/mo this rent would consume 52% of the median local household income ($76k/yr) (locally 722% 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 67 days. Have you received any prior offers? Is the seller open to a 10% 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 1910 — 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?
• 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.