1535 Mckinnon Ave

San Francisco, CA 94124

$499,998C

3 bd · 1.0 ba · 1,348 sqft · Built 1900 · SingleFamily · Active · 20 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $4,835/mo
• Mortgage (P&I): −$2,622
• Tax + insurance: −$306
• HOA: −$0
• Vac / Maint / Mgmt: −$1,015
• Net cashflow: $891/mo
• Annual: $10,693/yr
• Cap rate: 8.43%
• Cash-on-cash: 7.64%
• DSCR: 1.34
• 1% rule: 0.97%
• Cash to close: $139,999

Investor read

• This is a 3-bed/1.0-bath single-family listed at $500k.
• At list price, monthly cash flow is $891 ($11k/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 $483k (3.3% below list).
• It's been on market 20 days — a 2% lower offer ($492k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $483k (3.3% 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 76/100 on livability (#90 in CA, #3,143 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, employment A+; Watch: crime F, cost of living F.
• San Francisco Unified (urban): math 50% / reading 56% proficiency, ranked #322 of 1,400 in CA (top 23%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 93 active listings in the ZIP; 17 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 47% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 750 units permitted in San Francisco County in 2024 (688 in 5+ unit buildings).
• San Francisco County population projected at +39% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Cap rate 8.4% vs local median 2.1% in San Francisco — 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 $4,835/mo this rent would consume 72% of the median local household income ($81k/yr) (locally 1605% 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 1900 — 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 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?
• 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 for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.