617 West 3rd St

Long Beach, CA 90802

$1,699,999B+

4 bd · 4.0 ba · 3,310 sqft · Built 1921 · MultiFamily · Active · 72 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $24,744/mo
• Mortgage (P&I): −$8,915
• Tax + insurance: −$1,108
• HOA: −$0
• Vac / Maint / Mgmt: −$5,196
• Net cashflow: $9,525/mo
• Annual: $114,302/yr
• Cap rate: 13.02%
• Cash-on-cash: 24.01%
• DSCR: 2.07
• 1% rule: 1.46%
• Cash to close: $476,000

Investor read

• This is a 9 × 9-bed/9.0-bath units multifamily listed at $1.70M.
• At list price, monthly cash flow is $10k ($114k/yr) — positive. Per door: $1k/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($25k rent vs $1.70M).
• It's been on market 72 days — a 6% lower offer ($1.60M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.60M (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $12k of loan paydown is wiped out by about $51k of value loss. Plan a longer hold.
• Location reads 67/100 on livability (#319 in CA) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, employment B+; Watch: health & safety C-, crime F, cost of living F.
• Long Beach Unified (urban): math 34% / reading 50% proficiency, ranked #216 of 517 in CA (top 42%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Chavez Elementary (math 12%, 337 students, 65% FRL); Washington Middle (math 21% / reading 34%, grade F, #239 of 498 statewide, top 48%, 941 students, 77% FRL); Cabrillo High (math 22% / reading 52%, grade F, #578 of 1,170 statewide, top 51%, 1,786 students, 66% FRL).
• Watch-outs: built in 1921 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.1%/yr); 205 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 19,697 units permitted in Los Angeles County in 2024 (9,426 in 5+ unit buildings).
• Los Angeles County population projected at +9% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 5 sale attempts; this cycle's ask has dropped $199k (10%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $1.36M; 25% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 1.1% rent growth), your $476k cash investment doubles in ~6 years — after that, you're playing with house money.
• Cap rate 13.0% vs local median 1.9% in Long Beach — 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 $24,744/mo this rent would consume 399% of the median local household income ($75k/yr) (locally 4689% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• It's been on market 72 days. Have you received any prior offers? Is the seller open to a 6% 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 1921 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• 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.