1816 S La Brea Ave

Los Angeles, CA 90019

$1,399,999D

5 bd · 5.0 ba · 4,076 sqft · Built 1924 · MultiFamily · Active · 140 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $13,065/mo
• Mortgage (P&I): −$7,342
• Tax + insurance: −$2,265
• HOA: −$0
• Vac / Maint / Mgmt: −$2,744
• Net cashflow: $715/mo
• Annual: $8,577/yr
• Cap rate: 7.01%
• Cash-on-cash: 2.56%
• DSCR: 1.11
• 1% rule: 0.93%
• Cash to close: $392,000

Investor read

• This is a 4×2.0bd/1.0ba + 1×1.0bd/0.75ba units multifamily listed at $1.40M.
• At list price, monthly cash flow is $715 ($9k/yr) — positive. Per door: $143/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 $1.31M (6.7% below list).
• It's been on market 140 days — a 12% lower offer ($1.23M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.23M (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $10k of loan paydown is wiped out by about $42k of value loss. Plan a longer hold.
• 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: Alta Loma Elementary (386 students, 96% FRL); Johnnie Cochran Jr. Middle (545 students, 99% FRL); Los Angeles Senior High (math 16% / reading 43%, grade F, #750 of 1,170 statewide, top 66%, 1,043 students, 95% FRL) — zoned schools average 97% FRL vs 67% district-wide (29 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 30% at this address vs 42% district-wide (-12 pts) — the specific schools serving this property underperform the Los Angeles Unified average; the district grade overstates school quality for this exact location.
• Watch-outs: flood insurance adds $122/mo; built in 1924 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents soft (-0.5%/yr); 206 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 67% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• 10 sale attempts since 27y ago; this cycle's ask has dropped $195k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Climate carrying-cost: in FEMA flood zone AO (mandatory federal flood insurance); extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.0% 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 $13,065/mo this rent would consume 212% of the median local household income ($74k/yr) (locally 5272% 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 140 days. Have you received any prior offers? Is the seller open to a 12% 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 1924 — 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?
• 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?