715 N Sutter St

Stockton, CA 95202

$549,000C

32 bd · 16.0 ba · 3,033 sqft · Built 1940 · MultiFamily · Pending · 18 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,185/mo
• Mortgage (P&I): −$2,879
• Tax + insurance: −$425
• HOA: −$0
• Vac / Maint / Mgmt: −$1,089
• Net cashflow: $792/mo
• Annual: $9,508/yr
• Cap rate: 8.02%
• Cash-on-cash: 6.19%
• DSCR: 1.28
• 1% rule: 0.94%
• Cash to close: $153,720

Investor read

• This is a 32-bed/16.0-bath multifamily listed at $549k.
• At list price, monthly cash flow is $792 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $518k (5.6% below list).
• It's been on market 18 days — a 2% lower offer ($541k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $518k (5.6% below list) — sets the bar for 1% rule.
• In year one you build about $8k of equity ($4k loan paydown + $4k appreciation (0.7% local appreciation)).
• Location reads 57/100 on livability (#734 in CA) — a working-class tenant base; expect higher turnover. Strengths: housing A+, health & safety A, amenities A-; Watch: employment C-, schools D-, crime F.
• Stockton Unified (urban): math 23% / reading 46% proficiency, ranked #295 of 517 in CA (top 57%) — 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 1940 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 24 active listings in the ZIP; lower-income renter base — watch delinquency; 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.
• Current owner paid $149k; list at $549k implies a 268% gain — meaningful room to come down on a strong offer.
• At projected returns (0.7% appreciation + 3.0% rent growth), your $154k cash investment doubles in ~7 years — after that, you're playing with house money.
• By year 5, paydown + projected appreciation supports a ~$37k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: moderate flood risk; extreme-heat days projected 7→15/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 8.0% vs local median 3.6% in Stockton — 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 $5,185/mo this rent would consume 201% of the median local household income ($31k/yr) (locally 837% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1940 — 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.
• 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?
• 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.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.
• How much new apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.