10217 Sheridan Ave S #10219

Parkland, WA 98444

$555,000D

6 bd · 3.0 ba · 2,174 sqft · Built 1995 · MultiFamily · Active · 10 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,885/mo
• Mortgage (P&I): −$2,910
• Tax + insurance: −$925
• HOA: −$0
• Vac / Maint / Mgmt: −$816
• Net cashflow: $-766/mo
• Annual: $-9,196/yr
• Cap rate: 4.64%
• Cash-on-cash: -5.92%
• DSCR: 0.74
• 1% rule: 0.70%
• Cash to close: $155,400

Investor read

• This is a 2 × 3.0-bed/1.5-bath units multifamily listed at $555k.
• At list price, monthly cash flow is $-766 ($-9k/yr) — negative. Per door: $-383/mo.
• To cash-flow at today's rent, offer at most $444k (20.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $388k (30.0% below list).
• Only 10 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $388k (30.0% below list) — sets the bar for 1% rule.
• In year one you build about $59k of equity ($4k loan paydown + $56k appreciation (10.0% local appreciation)).
• Location reads 77/100 on livability (#148 in WA, #3,068 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, housing A+, health & safety A+; Watch: amenities D+, crime F.
• Franklin Pierce School District (suburban): math 35% / reading 51% proficiency, ranked #197 of 291 in WA (top 68%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Christensen Elementary (368 students, 74% FRL); Perry G Keithley Middle School (787 students, 68% FRL); Washington High School (997 students, 67% FRL).
• Market conditions: Rents rising (+2.9%/yr); 159 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 67% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• By year 2, paydown + projected appreciation supports a ~$95k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 4.6% vs local median 2.3% in Parkland — 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 $3,885/mo this rent would consume 71% of the median local household income ($65k/yr) (locally 2169% 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?
• 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?
• 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.