706 2nd St

Cheney, WA 99004

$515,000B+

13 bd · 3.0 ba · 5,027 sqft · Built 1999 · MultiFamily · Active · 17 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,803/mo
• Mortgage (P&I): −$2,701
• Tax + insurance: −$531
• HOA: −$0
• Vac / Maint / Mgmt: −$1,429
• Net cashflow: $2,143/mo
• Annual: $25,710/yr
• Cap rate: 11.29%
• Cash-on-cash: 17.83%
• DSCR: 1.79
• 1% rule: 1.32%
• Cash to close: $144,200

Investor read

• This is a 4 × 3-bed/?-bath units multifamily listed at $515k.
• At list price, monthly cash flow is $2k ($26k/yr) — positive. Per door: $536/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $515k).
• It's been on market 17 days — a 2% lower offer ($507k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $507k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $15k of value loss. Plan a longer hold.
• Location reads 79/100 on livability (#108 in WA, #2,146 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, health & safety A+, housing B+; Watch: crime C-, amenities C-, employment D.
• Cheney School District (town): math 47% / reading 56% proficiency, ranked #140 of 291 in WA (top 48%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Cheney Open Doors (9 students, 33% FRL).
• Market conditions: Rents rising (+2.3%/yr); 316 active listings in the ZIP; 3,608 units permitted in Spokane County in 2024 (1,792 in 5+ unit buildings).
• Spokane County population projected at +13% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 9 sale attempts since 26y 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 $250k; list at $515k implies a 106% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 2.3% rent growth), your $144k cash investment doubles in ~8 years — after that, you're playing with house money.
• Climate carrying-cost: severe wildfire risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.3% vs local median 2.2% in Cheney — 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 $6,803/mo this rent would consume 121% of the median local household income ($67k/yr) (locally 1045% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• 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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-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?
• 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.