7687 Francis Ln Unit 1-4

Birch Bay, WA 98230

$1,000,000D

28 bd · 16.0 ba · 2,004 sqft · Built 1952 · MultiFamily · Active · 726 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,784/mo
• Mortgage (P&I): −$5,244
• Tax + insurance: −$2,093
• HOA: −$0
• Vac / Maint / Mgmt: −$1,425
• Net cashflow: $-1,978/mo
• Annual: $-23,735/yr
• Cap rate: 4.43%
• Cash-on-cash: -6.65%
• DSCR: 0.70
• 1% rule: 0.68%
• Cash to close: $280,000

Investor read

• This is a 3×2bd/1ba + 1×1bd/1ba units multifamily listed at $1.00M. Condition is rated good.
• At list price, monthly cash flow is $-2k ($-24k/yr) — negative. Per door: $-494/mo.
• To cash-flow at today's rent, offer at most $714k (28.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $678k (32.2% below list).
• It's been on market 726 days — a 12% lower offer ($880k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $678k (32.2% below list) — sets the bar for 1% rule.
• In year one you build about $107k of equity ($7k loan paydown + $100k appreciation (10.0% local appreciation)).
• Location reads 62/100 on livability (#406 in WA) — a middle-class / working-renter tenant base. Strengths: housing A; Watch: cost of living D+, health & safety D, schools F.
• Blaine School District (town): math 49% / reading 55% proficiency, ranked #120 of 291 in WA (top 41%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: flood insurance adds $427/mo; built in 1952 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+3.1%/yr); 461 active listings in the ZIP; solid renter incomes; 1,190 units permitted in Whatcom County in 2024 (327 in 5+ unit buildings).
• Whatcom County population projected at +28% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• By year 2, paydown + projected appreciation supports a ~$172k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: in FEMA flood zone AE (mandatory federal flood insurance) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.4% vs local median 2.6% in Birch Bay — 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 $6,784/mo this rent would consume 94% of the median local household income ($87k/yr) (locally 454% 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?
• It's been on market 726 days. Have you received any prior offers? Is the seller open to a 32% 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 1952 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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.