Madison-403 Plan

San Francisco, CA 94124

$406,000F

1 bd · 1.0 ba · 552 sqft · Built — · Condo · Active · 464 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,088/mo
• Mortgage (P&I): −$2,428
• Tax + insurance: −$772
• HOA: −$698
• Vac / Maint / Mgmt: −$649
• Net cashflow: $-1,457/mo
• Annual: $-17,485/yr
• Cap rate: 2.52%
• Cash-on-cash: -13.49%
• DSCR: 0.40
• 1% rule: 0.67%
• Cash to close: $129,613

Investor read

• This is a 1-bed/1.0-bath condo listed at $406k.
• At list price, monthly cash flow is $-1k ($-17k/yr) — negative.
• To cash-flow at today's rent, offer at most $353k (13.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $309k (23.9% below list).
• It's been on market 464 days — a 12% lower offer ($357k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $309k (23.9% 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 $14k 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: HOA is 23% of rent.
• Market conditions: 95 active listings in the ZIP; 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.
• At $3,088/mo this rent would consume 46% 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

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• It's been on market 464 days. Have you received any prior offers? Is the seller open to a 24% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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 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?