22405 22407 120th St E

Prairie Ridge, WA 98391

$549,950C-

4 bd · 2.0 ba · 1,536 sqft · Built 1978 · MultiFamily · Active · 78 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,713/mo
• Mortgage (P&I): −$2,884
• Tax + insurance: −$588
• HOA: −$0
• Vac / Maint / Mgmt: −$990
• Net cashflow: $251/mo
• Annual: $3,011/yr
• Cap rate: 6.84%
• Cash-on-cash: 1.96%
• DSCR: 1.09
• 1% rule: 0.86%
• Cash to close: $153,986

Investor read

• This is a 2 × 2-bed/1.0-bath units multifamily listed at $550k.
• At list price, monthly cash flow is $251 ($3k/yr) — positive. Per door: $125/mo.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $471k (14.3% below list).
• It's been on market 78 days — a 6% lower offer ($517k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $471k (14.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $4k of loan paydown is wiped out by about $16k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#401 in WA) — a middle-class / working-renter tenant base. Strengths: employment A+, housing A+; Watch: amenities F, commute F, cost of living D-.
• White River School District (suburban): math 57% / reading 68% proficiency, ranked #35 of 291 in WA (top 12%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Foothills Elementary (489 students, 51% FRL); Glacier Middle School (970 students, 35% FRL); White River High School (1,263 students, 32% FRL).
• Market conditions: Rents rising (+3.5%/yr); 741 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 0d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 3,209 units permitted in Pierce County in 2024 (1,269 in 5+ unit buildings).
• Pierce County population projected at +26% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 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 $116k; list at $550k implies a 374% gain — meaningful room to come down on a strong offer.
• Cap rate 6.8% vs local median 3.3% in Prairie Ridge — 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.
• This rent runs 42% of the median local income ($135k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 78 days. Have you received any prior offers? Is the seller open to a 14% 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 1978 — 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 F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.