731 W 54th

Los Angeles, CA 90037

$499,000C-

2 bd · 2.0 ba · 1,156 sqft · Built 1915 · MultiFamily · Active · 17 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,067/mo
• Mortgage (P&I): −$2,617
• Tax + insurance: −$344
• HOA: −$0
• Vac / Maint / Mgmt: −$854
• Net cashflow: $252/mo
• Annual: $3,026/yr
• Cap rate: 6.90%
• Cash-on-cash: 2.17%
• DSCR: 1.10
• 1% rule: 0.82%
• Cash to close: $139,720

Investor read

• This is a 2 × 1-bed/1.0-bath units multifamily listed at $499k.
• At list price, monthly cash flow is $252 ($3k/yr) — positive. Per door: $126/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 $407k (18.5% below list).
• It's been on market 17 days — a 2% lower offer ($492k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $407k (18.5% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $15k 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-, crime F, cost of living 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.
• Zoned schools: Fifty-Second Street Elementary (619 students, 98% FRL); John Muir Middle (693 students, 99% FRL); Augustus Hawkins High (math 17% / reading 27%, grade F, #950 of 1,170 statewide, top 82%, 1,179 students, 98% FRL) — zoned schools average 98% FRL vs 67% district-wide (31 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 22% at this address vs 42% district-wide (-20 pts) — the specific schools serving this property underperform the Los Angeles Unified average; the district grade overstates school quality for this exact location.
• Watch-outs: built in 1915 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.7%/yr); 104 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals at typical pace (median 27d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• 12 sale attempts since 20y 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 $129k; list at $499k implies a 287% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.9% 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.

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?
• Built in 1915 — 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.