555 Westmont Ave

San Luis Obispo, CA 93405

$19,250,000D-

3773 bd · 2646.0 ba · 6,540 sqft · Built 1962 · MultiFamily · Active · 147 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $127,545/mo
• Mortgage (P&I): −$100,949
• Tax + insurance: −$16,669
• HOA: −$0
• Vac / Maint / Mgmt: −$26,784
• Net cashflow: $-16,858/mo
• Annual: $-202,292/yr
• Cap rate: 5.24%
• Cash-on-cash: -3.75%
• DSCR: 0.83
• 1% rule: 0.66%
• Cash to close: $5,390,000

Investor read

• This is a 26×1bd/1ba + 18×2bd/1ba + 5×3bd/2ba units multifamily listed at $19.25M.
• At list price, monthly cash flow is $-17k ($-202k/yr) — negative. Per door: $-344/mo.
• To cash-flow at today's rent, offer at most $16.27M (15.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $12.75M (33.7% below list).
• It's been on market 147 days — a 12% lower offer ($16.94M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $12.75M (33.7% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $133k of loan paydown is wiped out by about $578k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#132 in CA, #4,576 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, health & safety A+; Watch: crime F, cost of living F.
• San Luis Coastal Unified (urban): math 50% / reading 58% proficiency, ranked #118 of 517 in CA (top 23%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents rising fast (+7.0%/yr); 51 active listings in the ZIP; 1,104 units permitted in San Luis Obispo County in 2024 (273 in 5+ unit buildings).
• San Luis Obispo County population projected at +20% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 20 sale attempts since 27y 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 $6.75M; list at $19.25M implies a 185% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major wildfire risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.2% vs local median 2.1% in San Luis Obispo — 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 $127,545/mo this rent would consume 2534% of the median local household income ($60k/yr) (locally 3368% 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?
• It's been on market 147 days. Have you received any prior offers? Is the seller open to a 34% 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 1962 — 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?