603 Madison St

Oakland, CA 94607

$1,050,000C-

4 bd · 2.0 ba · 2,460 sqft · Built 1910 · MultiFamily · Active · 91 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $11,096/mo
• Mortgage (P&I): −$5,506
• Tax + insurance: −$1,123
• HOA: −$0
• Vac / Maint / Mgmt: −$2,330
• Net cashflow: $2,137/mo
• Annual: $25,640/yr
• Cap rate: 8.73%
• Cash-on-cash: 8.72%
• DSCR: 1.39
• 1% rule: 1.06%
• Cash to close: $294,000

Investor read

• This is a 4 × 2-bed/1.0-bath units multifamily listed at $1.05M.
• At list price, monthly cash flow is $2k ($26k/yr) — positive. Per door: $534/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($11k rent vs $1.05M).
• It's been on market 91 days — a 9% lower offer ($956k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $956k (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $7k of loan paydown is wiped out by about $32k of value loss. Plan a longer hold.
• Location reads 71/100 on livability (#224 in CA) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, employment A+; Watch: schools C-, crime F, cost of living F.
• Oakland Unified (urban): math 27% / reading 33% proficiency, ranked #1,007 of 1,400 in CA (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1910 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+3.2%/yr); 133 active listings in the ZIP; 11 comparable units currently listed for rent nearby; rentals leasing fast (median 4d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 1,742 units permitted in Alameda County in 2024 (856 in 5+ unit buildings).
• Alameda County population projected at +34% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts; this cycle's ask is 19% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $170k; list at $1.05M implies a 518% gain — meaningful room to come down on a strong offer.
• Cap rate 8.7% vs local median 2.4% in Oakland — 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 $11,096/mo this rent would consume 140% of the median local household income ($95k/yr) (locally 2002% 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 91 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 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.
• 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?
• 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.