411 N Chester

Compton, CA 90221

$1,549,000D

10 bd · 8.0 ba · 5,909 sqft · Built 1947 · MultiFamily · Active · 166 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $15,808/mo
• Mortgage (P&I): −$8,123
• Tax + insurance: −$2,350
• HOA: −$0
• Vac / Maint / Mgmt: −$3,320
• Net cashflow: $2,015/mo
• Annual: $24,183/yr
• Cap rate: 7.85%
• Cash-on-cash: 5.58%
• DSCR: 1.25
• 1% rule: 1.02%
• Cash to close: $433,720

Investor read

• This is a 10-bed/8.0-bath multifamily listed at $1.55M.
• At list price, monthly cash flow is $2k ($24k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($16k rent vs $1.55M).
• It's been on market 166 days — a 12% lower offer ($1.36M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.36M (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $11k of loan paydown is wiped out by about $46k of value loss. Plan a longer hold.
• Location reads 56/100 on livability (#803 in CA) — a working-class tenant base; expect higher turnover. Strengths: commute A+, housing B; Watch: schools D, crime F, amenities D-.
• Compton Unified (suburban): math 31% / reading 38% proficiency, ranked #910 of 1,400 in CA (top 65%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 78% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1947 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 38 active listings in the ZIP; 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.
• 4 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 $985k; list at $1.55M implies a 57% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.9% vs local median 3.0% in Compton — 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 166 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1947 — 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.
• 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?
• 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?
• 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.