9711 Salt Lake Ave

South Gate, CA 90280

$2,295,000D

3 bd · 3.0 ba · 1,650 sqft · Built 1950 · MultiFamily · Active · 84 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $20,327/mo
• Mortgage (P&I): −$12,035
• Tax + insurance: −$3,321
• HOA: −$0
• Vac / Maint / Mgmt: −$4,269
• Net cashflow: $702/mo
• Annual: $8,423/yr
• Cap rate: 6.66%
• Cash-on-cash: 1.31%
• DSCR: 1.06
• 1% rule: 0.89%
• Cash to close: $642,600

Investor read

• This is a 10 × 1-bed/1-bath units multifamily listed at $2.29M.
• At list price, monthly cash flow is $702 ($8k/yr) — positive. Per door: $70/mo.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $2.03M (11.4% below list).
• It's been on market 84 days — a 6% lower offer ($2.16M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $2.03M (11.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $16k of loan paydown is wiped out by about $69k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#459 in CA) — a middle-class / working-renter tenant base. Strengths: commute A+; Watch: health & safety C-, crime F, cost of living F.
• Los Angeles Unified (urban): math 29% / reading 54% proficiency, ranked #223 of 517 in CA (top 43%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases; 67% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Tweedy Elementary (460 students, 88% FRL); South Gate Middle (1,342 students, 94% FRL); South East High (math 30% / reading 68%, grade D, #369 of 1,170 statewide, top 32%, 2,057 students, 94% FRL) — zoned schools average 92% FRL vs 67% district-wide (25 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+5.0%/yr); 52 active listings in the ZIP; 8 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• 6 sale attempts since 9y 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.
• Climate carrying-cost: extreme-heat days projected 7→22/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.7% vs local median 2.7% in South Gate — 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 $20,327/mo this rent would consume 327% of the median local household income ($75k/yr) (locally 4041% 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 84 days. Have you received any prior offers? Is the seller open to a 11% 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 1950 — 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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?