1905 E Pontiac Way

Fresno, CA 93726

$5,670,000C-

44 bd · 42.0 ba · 28,728 sqft · Built 1978 · MultiFamily · Active · 15 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $52,813/mo
• Mortgage (P&I): −$29,734
• Tax + insurance: −$4,317
• HOA: −$0
• Vac / Maint / Mgmt: −$11,091
• Net cashflow: $7,671/mo
• Annual: $92,054/yr
• Cap rate: 7.92%
• Cash-on-cash: 5.80%
• DSCR: 1.26
• 1% rule: 0.93%
• Cash to close: $1,587,600

Investor read

• This is a 40×1bd/1ba + 2×2bd/1ba units multifamily listed at $5.67M.
• At list price, monthly cash flow is $8k ($92k/yr) — positive. Per door: $183/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 $5.28M (6.9% below list).
• It's been on market 15 days — a 2% lower offer ($5.58M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $5.28M (6.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $39k of loan paydown is wiped out by about $170k of value loss. Plan a longer hold.
• Location reads 62/100 on livability (#469 in CA) — a middle-class / working-renter tenant base. Strengths: commute A+, housing A+; Watch: amenities D+, employment D+, schools D.
• Fresno Unified (urban): math 18% / reading 47% proficiency, ranked #327 of 517 in CA (top 63%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 77% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising (+2.6%/yr); 83 active listings in the ZIP; 2,426 units permitted in Fresno County in 2024 (296 in 5+ unit buildings).
• Fresno County population projected at +11% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 5 sale attempts since 14y 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 $1.50M; list at $5.67M implies a 278% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.9% vs local median 3.7% in Fresno — 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 $52,813/mo this rent would consume 1136% of the median local household income ($56k/yr) (locally 3028% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 1978 — 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.