702 N L St

Tacoma, WA 98403

$875,000D

25 bd · 25.0 ba · 3,084 sqft · Built 1949 · MultiFamily · Active · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $7,210/mo
• Mortgage (P&I): −$4,589
• Tax + insurance: −$1,015
• HOA: −$0
• Vac / Maint / Mgmt: −$1,514
• Net cashflow: $92/mo
• Annual: $1,104/yr
• Cap rate: 6.42%
• Cash-on-cash: 0.45%
• DSCR: 1.02
• 1% rule: 0.82%
• Cash to close: $245,000

Investor read

• This is a 4×1bd/1.0ba + 1×2bd/1.0ba units multifamily listed at $875k.
• At list price, monthly cash flow is $92 ($1k/yr) — positive. Per door: $18/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 $721k (17.6% below list).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $721k (17.6% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $6k of loan paydown is wiped out by about $26k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#127 in WA, #2,535 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, housing A+; Watch: cost of living D, crime F.
• Tacoma School District (urban): math 40% / reading 53% proficiency, ranked #169 of 291 in WA (top 58%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1949 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.9%/yr); 41 active listings in the ZIP; solid renter incomes; 3,209 units permitted in Pierce County in 2024 (1,269 in 5+ unit buildings).
• Pierce County population projected at +26% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 21y 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 $453k; list at $875k implies a 93% gain — meaningful room to come down on a strong offer.
• Cap rate 6.4% vs local median 2.9% in Tacoma — 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 $7,210/mo this rent would consume 98% of the median local household income ($88k/yr) (locally 328% 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 1949 — 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?
• 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?
• 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.