6472 Cavalleri Rd

Malibu, CA 90265

$699,000C-

2 bd · 2.0 ba · 1,056 sqft · Built 1975 · Condo · Pending · 79 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,530/mo
• Mortgage (P&I): −$3,666
• Tax + insurance: −$1,054
• HOA: −$1,008
• Vac / Maint / Mgmt: −$1,581
• Net cashflow: $221/mo
• Annual: $2,656/yr
• Cap rate: 6.67%
• Cash-on-cash: 1.36%
• DSCR: 1.06
• 1% rule: 1.08%
• Cash to close: $195,720

Investor read

• This is a 2-bed/2.0-bath condo listed at $699k.
• At list price, monthly cash flow is $221 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($8k rent vs $699k).
• It's been on market 79 days — a 6% lower offer ($657k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $657k (6.0% below list) — sets the bar for market timing.
• In year one you build about $9k of equity ($5k loan paydown + $4k 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.
• Market conditions: Rents falling (-3.4%/yr); 636 active listings in the ZIP; 27 comparable units currently listed for rent nearby; rentals at typical pace (median 24d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• 5 sale attempts since 28y 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.
• By year 5, paydown + projected appreciation supports a ~$45k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 6.7% 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 $7,530/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

• It's been on market 79 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Built in 1975 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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?