22626 Pacific Coast Hwy #22

Malibu, CA 90265

$1,099,000D

1 bd · 1.0 ba · 693 sqft · Built 1963 · Condo · Active · 281 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,600/mo
• Mortgage (P&I): −$5,763
• Tax + insurance: −$1,164
• HOA: −$1,480
• Vac / Maint / Mgmt: −$1,596
• Net cashflow: $-2,403/mo
• Annual: $-28,841/yr
• Cap rate: 3.74%
• Cash-on-cash: -9.11%
• DSCR: 0.59
• 1% rule: 0.69%
• Cash to close: $307,720

Investor read

• This is a 1-bed/1.0-bath condo listed at $1.10M.
• At list price, monthly cash flow is $-2k ($-29k/yr) — negative.
• To cash-flow at today's rent, offer at most $674k (38.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $760k (30.8% below list).
• It's been on market 281 days — a 12% lower offer ($967k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $674k (38.6% below list) — sets the bar for cash-flow.
• In year one you build about $14k of equity ($8k loan paydown + $7k appreciation (0.6% local appreciation)).
• Location reads 53/100 on livability (#979 in CA) — a working-class tenant base; expect higher turnover. Strengths: employment A+, schools B; Watch: housing C-, crime F, amenities F.
• Santa Monica-Malibu Unified (urban): math 61% / reading 74% proficiency, ranked #123 of 1,400 in CA (top 9%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: flood insurance adds $66/mo.
• Market conditions: Rents falling (-3.4%/yr); 627 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 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.
• 6 sale attempts since 24y 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 $443k; list at $1.10M implies a 148% gain — meaningful room to come down on a strong offer.
• By year 5, paydown + projected appreciation supports a ~$70k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: severe flood risk; major wildfire risk; extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 3.7% vs local median 0.7% in Malibu — 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 $7,600/mo this rent would consume 46% of the median local household income ($197k/yr) (locally 420% 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 281 days. Have you received any prior offers? Is the seller open to a 39% concession, seller financing, or rate buy-down credit?
• Built in 1963 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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.