9116 Palm St

Bellflower, CA 90706

$3,895,000C

24 bd · 24.0 ba · 12,704 sqft · Built 1963 · MultiFamily · Active · 90 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $37,816/mo
• Mortgage (P&I): −$20,426
• Tax + insurance: −$4,642
• HOA: −$0
• Vac / Maint / Mgmt: −$7,941
• Net cashflow: $4,807/mo
• Annual: $57,681/yr
• Cap rate: 7.77%
• Cash-on-cash: 5.29%
• DSCR: 1.24
• 1% rule: 0.97%
• Cash to close: $1,090,600

Investor read

• This is a 16 × 2.0-bed/1.5-bath units multifamily listed at $3.90M.
• At list price, monthly cash flow is $5k ($58k/yr) — positive. Per door: $300/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 $3.78M (2.9% below list).
• It's been on market 90 days — a 6% lower offer ($3.66M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $3.66M (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $27k of loan paydown is wiped out by about $117k of value loss. Plan a longer hold.
• Location reads 62/100 on livability (#483 in CA) — a middle-class / working-renter tenant base. Strengths: commute A+; Watch: amenities C-, health & safety D+, crime F.
• Bellflower Unified (suburban): math 32% / reading 50% proficiency, ranked #667 of 1,400 in CA (top 48%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising (+2.8%/yr); 70 active listings in the ZIP; solid renter incomes; 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.
• 7 sale attempts since 24y 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 $2.10M; list at $3.90M implies a 85% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.8% vs local median 2.5% in Bellflower — 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 $37,816/mo this rent would consume 576% of the median local household income ($79k/yr) (locally 4049% 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 90 days. Have you received any prior offers? Is the seller open to a 6% 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 1963 — 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.