4045 Dennison St

East Los Angeles, CA 90023

$1,299,999D-

2 bd · 1.0 ba · 790 sqft · Built 1955 · MultiFamily · Active · 17 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $10,629/mo
• Mortgage (P&I): −$6,817
• Tax + insurance: −$1,703
• HOA: −$0
• Vac / Maint / Mgmt: −$2,232
• Net cashflow: $-123/mo
• Annual: $-1,475/yr
• Cap rate: 6.18%
• Cash-on-cash: -0.41%
• DSCR: 0.98
• 1% rule: 0.82%
• Cash to close: $364,000

Investor read

• This is a 2-bed/1.0-bath multifamily listed at $1.30M.
• At list price, monthly cash flow is $-123 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $1.28M (1.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $1.06M (18.2% below list).
• It's been on market 17 days — a 2% lower offer ($1.28M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.06M (18.2% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $9k of loan paydown is wiped out by about $39k of value loss. Plan a longer hold.
• Location reads 60/100 on livability (#594 in CA) — a middle-class / working-renter tenant base. Strengths: commute A+, schools B+; Watch: employment C-, health & safety D, crime F.
• Los Angeles Unified (urban): math 29% / reading 54% proficiency, ranked #223 of 517 in CA (top 43%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1955 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents flat; 57 active listings in the ZIP; 23 comparable units currently listed for rent nearby; rentals at typical pace (median 25d on market — plan ~3-4 weeks tenant-placement turnaround); 43% of comp listings sitting > 30 days — soft ceiling on asking rent; 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 since 9y 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 $830k; list at $1.30M implies a 57% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.2% vs local median 3.7% in East Los Angeles — 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 $10,629/mo this rent would consume 216% of the median local household income ($59k/yr) (locally 2670% 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?
• Built in 1955 — 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.
• 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.