1623 Vallejo St

San Francisco, CA 94123

$2,799,000D+

5 bd · 4.0 ba · 3,707 sqft · Built 1900 · MultiFamily · Active · 301 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $23,373/mo
• Mortgage (P&I): −$14,678
• Tax + insurance: −$3,009
• HOA: −$0
• Vac / Maint / Mgmt: −$4,908
• Net cashflow: $777/mo
• Annual: $9,323/yr
• Cap rate: 6.63%
• Cash-on-cash: 1.19%
• DSCR: 1.05
• 1% rule: 0.84%
• Cash to close: $783,720

Investor read

• This is a 5-bed/4.0-bath multifamily listed at $2.80M.
• At list price, monthly cash flow is $777 ($9k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $2.34M (16.5% below list).
• It's been on market 301 days — a 12% lower offer ($2.46M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $2.34M (16.5% below list) — sets the bar for 1% rule.
• In year one you build about $248k of equity ($19k loan paydown + $229k appreciation (8.2% local appreciation)).
• 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.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+19.2%/yr); 59 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 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.
• 2 sale attempts; this cycle's ask is 87% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $1.18M; list at $2.80M implies a 137% gain — meaningful room to come down on a strong offer.
• At projected returns (8.2% appreciation + 8.0% rent growth), your $784k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 2, paydown + projected appreciation supports a ~$398k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 6.6% 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 $23,373/mo this rent would consume 128% of the median local household income ($219k/yr) (locally 883% 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 301 days. Have you received any prior offers? Is the seller open to a 16% concession, seller financing, or rate buy-down credit?
• Built in 1900 — 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.
• 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.