1723-1725 7th Ave

San Francisco, CA 94122

$1,200,000D

4 bd · 2.0 ba · 2,376 sqft · Built 1948 · MultiFamily · Active · 498 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $8,964/mo
• Mortgage (P&I): −$6,293
• Tax + insurance: −$2,475
• HOA: −$0
• Vac / Maint / Mgmt: −$1,882
• Net cashflow: $-1,686/mo
• Annual: $-20,231/yr
• Cap rate: 4.67%
• Cash-on-cash: -5.78%
• DSCR: 0.74
• 1% rule: 0.75%
• Cash to close: $336,000

Investor read

• This is a 2 × 2-bed/?-bath units multifamily listed at $1.20M.
• At list price, monthly cash flow is $-2k ($-20k/yr) — negative. Per door: $-843/mo.
• To cash-flow at today's rent, offer at most $902k (24.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $896k (25.3% below list).
• It's been on market 498 days — a 12% lower offer ($1.06M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $896k (25.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $8k of loan paydown is wiped out by about $36k 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.
• Zoned schools: Lilienthal (Claire) Elementary (669 students, 19% FRL); Giannini (A.P.) Middle (1,192 students, 34% FRL); Lowell High (2,632 students, 37% FRL) — zoned schools average 30% FRL vs 49% district-wide (19 pts lower); this property's tenant base skews higher-income than the district average.
• Watch-outs: flood insurance adds $66/mo; built in 1948 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+9.7%/yr); 65 active listings in the ZIP; 18 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); 44% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 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.
• 4 sale attempts since 4y 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.
• Climate carrying-cost: severe flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.7% 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 $8,964/mo this rent would consume 74% of the median local household income ($146k/yr) (locally 2227% 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 498 days. Have you received any prior offers? Is the seller open to a 25% 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 1948 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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.