968 Addison St

Berkeley, CA 94710

$3,996,000C+

25 bd · 18.0 ba · 11,480 sqft · Built 1943 · MultiFamily · Active · 105 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $46,128/mo
• Mortgage (P&I): −$20,955
• Tax + insurance: −$7,815
• HOA: −$0
• Vac / Maint / Mgmt: −$9,687
• Net cashflow: $7,671/mo
• Annual: $92,052/yr
• Cap rate: 8.60%
• Cash-on-cash: 8.23%
• DSCR: 1.37
• 1% rule: 1.15%
• Cash to close: $1,118,880

Investor read

• This is a 12×1bd/1ba + 6×2bd/1ba units multifamily listed at $4.00M.
• At list price, monthly cash flow is $8k ($92k/yr) — positive. Per door: $426/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($46k rent vs $4.00M).
• It's been on market 105 days — a 9% lower offer ($3.64M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $3.64M (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $28k of loan paydown is wiped out by about $120k of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#74 in CA, #2,860 nationally) — a middle-class / working-renter tenant base. Strengths: schools A+, amenities A+, commute A+; Watch: crime F, cost of living F.
• Berkeley Unified (urban): math 61% / reading 67% proficiency, ranked #175 of 1,400 in CA (top 12%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: built in 1943 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.2%/yr); 30 active listings in the ZIP; solid renter incomes; 1,742 units permitted in Alameda County in 2024 (856 in 5+ unit buildings).
• Alameda County population projected at +34% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 9 sale attempts since 18y 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.
• Cap rate 8.6% vs local median 2.0% in Berkeley — 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 $46,128/mo this rent would consume 541% of the median local household income ($102k/yr) (locally 764% 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 105 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 1943 — 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 A-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?