795-797 Alcatraz Ave

Oakland, CA 94609

$790,000D

4 bd · 2.0 ba · 2,073 sqft · Built 1925 · MultiFamily · Pending · 55 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,622/mo
• Mortgage (P&I): −$4,143
• Tax + insurance: −$872
• HOA: −$0
• Vac / Maint / Mgmt: −$1,181
• Net cashflow: $-573/mo
• Annual: $-6,878/yr
• Cap rate: 5.42%
• Cash-on-cash: -3.11%
• DSCR: 0.86
• 1% rule: 0.71%
• Cash to close: $221,200

Investor read

• This is a 2 × 2-bed/1.0-bath units multifamily listed at $790k.
• At list price, monthly cash flow is $-573 ($-7k/yr) — negative. Per door: $-287/mo.
• To cash-flow at today's rent, offer at most $689k (12.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $562k (28.8% below list).
• It's been on market 55 days — a 3% lower offer ($766k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $562k (28.8% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $5k of loan paydown is wiped out by about $24k of value loss. Plan a longer hold.
• Location reads 71/100 on livability (#224 in CA) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, employment A+; Watch: schools C-, crime F, cost of living F.
• Oakland Unified (urban): math 27% / reading 33% proficiency, ranked #1,007 of 1,400 in CA (top 72%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1925 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+6.5%/yr); 85 active listings in the ZIP; 21 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 1,742 units permitted in Alameda County in 2024 (856 in 5+ unit buildings).
• Alameda County population projected at +34% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Cap rate 5.4% vs local median 2.4% in Oakland — 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 $5,622/mo this rent would consume 63% of the median local household income ($108k/yr) (locally 1721% 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 55 days. Have you received any prior offers? Is the seller open to a 29% 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 1925 — 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.
• 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?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?