3862 S Spring Ave

St. Louis, MO 63116

$1,195,000C+

432 bd · 324.0 ba · 15,312 sqft · Built 1931 · MultiFamily · Active · 110 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $15,668/mo
• Mortgage (P&I): −$6,267
• Tax + insurance: −$1,094
• HOA: −$0
• Vac / Maint / Mgmt: −$3,290
• Net cashflow: $5,017/mo
• Annual: $60,198/yr
• Cap rate: 11.33%
• Cash-on-cash: 17.99%
• DSCR: 1.80
• 1% rule: 1.31%
• Cash to close: $334,600

Investor read

• This is a 12×1bd/1ba + 6×2bd/1ba units multifamily listed at $1.20M.
• At list price, monthly cash flow is $5k ($60k/yr) — positive. Per door: $279/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($16k rent vs $1.20M).
• It's been on market 110 days — a 9% lower offer ($1.09M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.09M (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $8k of loan paydown is wiped out by about $36k of value loss. Plan a longer hold.
• Location reads: area grade C — affects rentability + tenant quality, not the cash-flow math above.
• St. Louis City (urban): math 10% / reading 18% proficiency, ranked #312 of 324 in MO (top 96%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 80% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Nahed Chapman New American Aca (math 2% / reading 2%, grade F, #1,099 of 1,115 statewide, top 100%, 335 students, 99% FRL); Gateway Middle (math 0% / reading 8%, grade F, #389 of 391 statewide, top 100%, 506 students, 99% FRL); Roosevelt High (math 2% / reading 8%, grade F, #517 of 521 statewide, top 100%, 460 students, 99% FRL) — zoned schools average 99% FRL vs 80% district-wide (19 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1931 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.6%/yr); 261 active listings in the ZIP; 294 units permitted in St. Louis city in 2024 (227 in 5+ unit buildings).
• St. Louis County population projected to shrink 6% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 7 sale attempts since 2y 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 $450k; list at $1.20M implies a 166% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 2.6% rent growth), your $335k cash investment doubles in ~7 years — after that, you're playing with house money.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.3% vs local median 5.0% in St. Louis — 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.

Questions for listing agent

• It's been on market 110 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 1931 — 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.
• 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.