312 Cherry

Lodi, CA 95240

$615,000F

12 bd · 9.0 ba · 1,931 sqft · Built 1920 · MultiFamily · Pending · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,170/mo
• Mortgage (P&I): −$3,225
• Tax + insurance: −$1,025
• HOA: −$0
• Vac / Maint / Mgmt: −$876
• Net cashflow: $-956/mo
• Annual: $-11,470/yr
• Cap rate: 4.43%
• Cash-on-cash: -6.66%
• DSCR: 0.70
• 1% rule: 0.68%
• Cash to close: $172,200

Investor read

• This is a 3 × 1-bed/1.0-bath units multifamily listed at $615k.
• At list price, monthly cash flow is $-956 ($-11k/yr) — negative. Per door: $-319/mo.
• To cash-flow at today's rent, offer at most $477k (22.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $417k (32.2% below list).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $417k (32.2% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $18k of value loss. Plan a longer hold.
• Location reads 58/100 on livability (#730 in CA) — a working-class tenant base; expect higher turnover. Strengths: housing A; Watch: schools C-, crime F, amenities F.
• Lodi Unified (urban): math 24% / reading 36% proficiency, ranked #325 of 517 in CA (top 63%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.1%/yr); 166 active listings in the ZIP; solid renter incomes; 3,779 units permitted in San Joaquin County in 2024 (0 in 5+ unit buildings).
• San Joaquin County population projected at +17% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Climate carrying-cost: extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.4% vs local median 3.0% in Lodi — 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 $4,170/mo this rent would consume 61% of the median local household income ($82k/yr) (locally 1918% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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?
• 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 1920 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.