1243 12th St

Santa Monica, CA 90401

$5,250,000A-

18 bd · 18.0 ba · 9,416 sqft · Built 1959 · MultiFamily · Active · 181 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $76,192/mo
• Mortgage (P&I): −$27,532
• Tax + insurance: −$4,611
• HOA: −$0
• Vac / Maint / Mgmt: −$16,000
• Net cashflow: $28,049/mo
• Annual: $336,586/yr
• Cap rate: 12.70%
• Cash-on-cash: 22.90%
• DSCR: 2.02
• 1% rule: 1.45%
• Cash to close: $1,470,000

Investor read

• This is a 4×1bd/1ba + 6×2bd/1.5ba + 6×2bd/2ba units multifamily listed at $5.25M.
• At list price, monthly cash flow is $28k ($337k/yr) — positive. Per door: $1k/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($76k rent vs $5.25M).
• It's been on market 181 days — a 12% lower offer ($4.62M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $4.62M (12.0% below list) — sets the bar for market timing.
• In year one you build about $113k of equity ($36k loan paydown + $77k appreciation (1.5% local appreciation)).
• Location reads 72/100 on livability (#178 in CA) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, employment A+; Watch: health & safety C-, crime F, cost of living F.
• Santa Monica-Malibu Unified (urban): math 61% / reading 74% proficiency, ranked #123 of 1,400 in CA (top 9%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Mckinley Elementary (403 students, 34% FRL); Lincoln Middle (math 24% / reading 24%, grade F, #277 of 498 statewide, top 73%, 854 students, 22% FRL); Santa Monica High (2,678 students, 30% FRL).
• Zoned-school proficiency averages 24% at this address vs 68% district-wide (-43 pts) — the specific schools serving this property underperform the Santa Monica-Malibu Unified average; the district grade overstates school quality for this exact location.
• Watch-outs: built in 1959 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents falling (-4.1%/yr); 28 active listings in the ZIP; high-income renter base; 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.
• 2 sale attempts; this cycle's ask has dropped $750k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $1.51M; list at $5.25M implies a 249% gain — meaningful room to come down on a strong offer.
• At projected returns (1.5% appreciation + 0.0% rent growth), your $1.47M cash investment doubles in ~4 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$398k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

Questions for listing agent

• It's been on market 181 days. Have you received any prior offers? Is the seller open to a 12% 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 1959 — 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 A-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?