906 Sartori

Torrance, CA 90501

$1,950,000D

10 bd · 10.0 ba · 5,394 sqft · Built 1975 · MultiFamily · Active · 226 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $16,301/mo
• Mortgage (P&I): −$10,226
• Tax + insurance: −$1,606
• HOA: −$0
• Vac / Maint / Mgmt: −$3,423
• Net cashflow: $1,046/mo
• Annual: $12,548/yr
• Cap rate: 6.94%
• Cash-on-cash: 2.30%
• DSCR: 1.10
• 1% rule: 0.84%
• Cash to close: $546,000

Investor read

• This is a 5 × 2-bed/2-bath units multifamily listed at $1.95M.
• At list price, monthly cash flow is $1k ($13k/yr) — positive. Per door: $209/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 $1.63M (16.4% below list).
• It's been on market 226 days — a 12% lower offer ($1.72M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.63M (16.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $13k of loan paydown is wiped out by about $58k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#95 in CA, #3,501 nationally) — a middle-class / working-renter tenant base. Strengths: schools A+, amenities A+, commute A+; Watch: health & safety C-, crime D+, cost of living F.
• Torrance Unified (urban): math 62% / reading 67% proficiency, ranked #150 of 1,400 in CA (top 11%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 20% free/reduced lunch — higher-income household profile.
• Market conditions: Rents rising (+3.2%/yr); 96 active listings in the ZIP; solid renter incomes; 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.
• 5 sale attempts since 32y ago; this cycle's ask has dropped $450k (19%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $475k; list at $1.95M implies a 311% gain — meaningful room to come down on a strong offer.
• Cap rate 6.9% vs local median 2.1% in Torrance — 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 $16,301/mo this rent would consume 211% of the median local household income ($93k/yr) (locally 1972% 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 226 days. Have you received any prior offers? Is the seller open to a 16% 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 1975 — 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 D 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?