1661 Arlington Ave

Los Angeles, CA 90019

$1,100,000C

3 bd · 2.0 ba · 2,133 sqft · Built 1905 · MultiFamily · Active · 258 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $14,016/mo
• Mortgage (P&I): −$5,769
• Tax + insurance: −$1,518
• HOA: −$0
• Vac / Maint / Mgmt: −$2,943
• Net cashflow: $3,786/mo
• Annual: $45,434/yr
• Cap rate: 10.42%
• Cash-on-cash: 14.75%
• DSCR: 1.66
• 1% rule: 1.27%
• Cash to close: $308,000

Investor read

• This is a 4 × 6-bed/4.0-bath units multifamily listed at $1.10M.
• At list price, monthly cash flow is $4k ($45k/yr) — positive. Per door: $947/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($14k rent vs $1.10M).
• It's been on market 258 days — a 12% lower offer ($968k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $968k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $8k of loan paydown is wiped out by about $33k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#273 in CA) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, employment B; Watch: health & safety C-, schools D+, crime F.
• Los Angeles Unified (urban): math 29% / reading 54% proficiency, ranked #223 of 517 in CA (top 43%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1905 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents soft (-0.5%/yr); 206 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; 19,697 units permitted in Los Angeles County in 2024 (9,426 in 5+ unit buildings).
• Los Angeles County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 8 sale attempts since 29y ago; this cycle's ask has dropped $100k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $745k; 48% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.4% vs local median 2.1% in Los Angeles — 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 $14,016/mo this rent would consume 227% of the median local household income ($74k/yr) (locally 5272% 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 258 days. Have you received any prior offers? Is the seller open to a 12% 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 1905 — 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 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?