20324 86th Avenue Ct E

Graham, WA 98387

$399,000D+

5 bd · 3.0 ba · 2,370 sqft · Built 1999 · SingleFamily · Active · 27 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,294/mo
• Mortgage (P&I): −$2,092
• Tax + insurance: −$650
• HOA: −$99
• Vac / Maint / Mgmt: −$692
• Net cashflow: $-240/mo
• Annual: $-2,877/yr
• Cap rate: 5.57%
• Cash-on-cash: -2.57%
• DSCR: 0.89
• 1% rule: 0.83%
• Cash to close: $111,720

Investor read

• This is a 5-bed/3.0-bath single-family listed at $399k.
• At list price, monthly cash flow is $-240 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $357k (10.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $329k (17.4% below list).
• It's been on market 27 days — a 2% lower offer ($393k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $329k (17.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#373 in WA) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+; Watch: crime C-, health & safety C-, amenities F.
• Bethel School District (suburban): math 47% / reading 59% proficiency, ranked #103 of 291 in WA (top 35%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Elk Plain School of Choice (570 students, 39% FRL); Liberty Middle School (936 students, 55% FRL); Graham Kapowsin High School (2,011 students, 49% FRL).
• Market conditions: Rents rising fast (+4.2%/yr); 388 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals leasing fast (median 14d on market — plan ~1-2 weeks tenant-placement turnaround); solid renter incomes; 3,209 units permitted in Pierce County in 2024 (1,269 in 5+ unit buildings).
• Pierce County population projected at +26% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 23y 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 $277k; 44% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 5.6% vs local median 3.6% in Graham — 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.
• This rent runs 37% of the median local income ($107k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• 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.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.