3530 E 42nd Ave

Anchorage, AK 99508

$775,000B+

12 bd · 6.0 ba · 6,120 sqft · Built 1974 · MultiFamily · Pending · 77 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $10,371/mo
• Mortgage (P&I): −$4,064
• Tax + insurance: −$1,123
• HOA: −$0
• Vac / Maint / Mgmt: −$2,178
• Net cashflow: $3,006/mo
• Annual: $36,070/yr
• Cap rate: 11.03%
• Cash-on-cash: 16.93%
• DSCR: 1.75
• 1% rule: 1.34%
• Cash to close: $217,000

Investor read

• This is a 6 × 2-bed/1.0-bath units multifamily listed at $775k.
• At list price, monthly cash flow is $3k ($36k/yr) — positive. Per door: $501/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($10k rent vs $775k).
• It's been on market 77 days — a 6% lower offer ($728k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $728k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $5k of loan paydown is wiped out by about $23k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#6 in AK, #2,553 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, employment A+; Watch: crime F, cost of living F.
• Anchorage School District (urban): math 37% / reading 43% proficiency, ranked #6 of 21 in AK (top 29%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: flood insurance adds $56/mo.
• Market conditions: Rents rising fast (+4.9%/yr); 147 active listings in the ZIP; solid renter incomes; 306 units permitted in Anchorage Municipality in 2024 (90 in 5+ unit buildings).
• Anchorage County population projected at +12% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 9 sale attempts since 8y 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.
• At projected returns (-3.0% appreciation + 4.9% rent growth), your $217k cash investment doubles in ~7 years — after that, you're playing with house money.
• Climate carrying-cost: severe flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 11.0% vs local median 3.8% in Anchorage — 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 $10,371/mo this rent would consume 157% of the median local household income ($79k/yr) (locally 1248% 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 77 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 1974 — 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.
• 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?