617 N Orange Dr

Los Angeles, CA 90036

$5,250,000C

20 bd · 20.0 ba · 15,000 sqft · Built 1964 · MultiFamily · Active · 104 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $53,887/mo
• Mortgage (P&I): −$27,532
• Tax + insurance: −$6,697
• HOA: −$0
• Vac / Maint / Mgmt: −$11,316
• Net cashflow: $8,343/mo
• Annual: $100,111/yr
• Cap rate: 8.20%
• Cash-on-cash: 6.81%
• DSCR: 1.30
• 1% rule: 1.03%
• Cash to close: $1,470,000

Investor read

• This is a 20 × 1-bed/?-bath units multifamily listed at $5.25M.
• At list price, monthly cash flow is $8k ($100k/yr) — positive. Per door: $417/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($54k rent vs $5.25M).
• It's been on market 104 days — a 9% lower offer ($4.78M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $4.78M (9.0% below list) — sets the bar for market timing.
• In year one you build about $170k of equity ($36k loan paydown + $134k appreciation (2.5% local appreciation)).
• 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-, crime F, cost of living 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.
• Zoned schools: Vine Street Elementary (251 students, 92% FRL); Hubert Howe Bancroft Middle (446 students, 92% FRL); Fairfax Senior High (math 40% / reading 61%, grade D+, #324 of 1,170 statewide, top 28%, 1,632 students, 81% FRL) — zoned schools average 89% FRL vs 67% district-wide (21 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents soft (-1.1%/yr); 94 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.
• At projected returns (2.5% appreciation + 0.0% rent growth), your $1.47M cash investment doubles in ~6 years — after that, you're playing with house money.
• By year 3, paydown + projected appreciation supports a ~$427k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.2% 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 $53,887/mo this rent would consume 589% of the median local household income ($110k/yr) (locally 4924% 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 104 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 1964 — 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?