420 Bungalow Dr NW

Olympia, WA 98502

$710,000D-

4 bd · 5.0 ba · 2,632 sqft · Built 2007 · MultiFamily · Active · 223 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,087/mo
• Mortgage (P&I): −$3,723
• Tax + insurance: −$1,183
• HOA: −$280
• Vac / Maint / Mgmt: −$858
• Net cashflow: $-1,958/mo
• Annual: $-23,495/yr
• Cap rate: 2.98%
• Cash-on-cash: -11.82%
• DSCR: 0.47
• 1% rule: 0.58%
• Cash to close: $198,800

Investor read

• This is a 2 × 2.0-bed/2.5-bath units multifamily listed at $710k.
• At list price, monthly cash flow is $-2k ($-23k/yr) — negative. Per door: $-979/mo.
• To cash-flow at today's rent, offer at most $427k (39.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $409k (42.4% below list).
• It's been on market 223 days — a 12% lower offer ($625k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $409k (42.4% below list) — sets the bar for 1% rule.
• In year one you build about $76k of equity ($5k loan paydown + $71k appreciation (10.0% local appreciation)).
• Location reads 83/100 on livability (#58 in WA, #1,036 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, health & safety A+; Watch: crime F, cost of living D-.
• Olympia School District (urban): math 66% / reading 75% proficiency, ranked #17 of 291 in WA (top 6%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Market conditions: Rents rising (+3.2%/yr); 304 active listings in the ZIP; 1 comparable units currently listed for rent nearby; solid renter incomes; 1,222 units permitted in Thurston County in 2024 (508 in 5+ unit buildings).
• Thurston County population projected at +27% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 14y ago; this cycle's ask has dropped $40k (5%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $318k; list at $710k implies a 123% gain — meaningful room to come down on a strong offer.
• By year 2, paydown + projected appreciation supports a ~$122k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 3.0% vs local median 2.4% in Olympia — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.
• At $4,087/mo this rent would consume 53% of the median local household income ($92k/yr) (locally 1811% 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?
• It's been on market 223 days. Have you received any prior offers? Is the seller open to a 42% 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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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?