1125 63rd St SE Unit 14-C

Auburn, WA 98092

$400,000D+

3 bd · 3.0 ba · 1,372 sqft · Built 2001 · Townhouse · Pending · 12 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,987/mo
• Mortgage (P&I): −$2,098
• Tax + insurance: −$546
• HOA: −$502
• Vac / Maint / Mgmt: −$627
• Net cashflow: $-786/mo
• Annual: $-9,428/yr
• Cap rate: 3.94%
• Cash-on-cash: -8.42%
• DSCR: 0.63
• 1% rule: 0.75%
• Cash to close: $112,000

Investor read

• This is a 3-bed/3.0-bath townhouse listed at $400k.
• At list price, monthly cash flow is $-786 ($-9k/yr) — negative.
• To cash-flow at today's rent, offer at most $261k (34.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $299k (25.3% below list).
• Only 12 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $261k (34.7% below list) — sets the bar for cash-flow.
• In year one you build about $43k of equity ($3k loan paydown + $40k appreciation (10.0% local appreciation)).
• Location reads 81/100 on livability (#75 in WA, #1,371 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, employment A+; Watch: crime F, cost of living F.
• Auburn School District (urban): math 47% / reading 56% proficiency, ranked #125 of 291 in WA (top 43%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Zoned schools: Lakeland Hills Elementary (536 students, 35% FRL); Auburn Riverside High School (1,909 students, 50% FRL) — zoned schools at 42% FRL track the district average.
• Market conditions: Rents soft (-0.5%/yr); 296 active listings in the ZIP; 13 comparable units currently listed for rent nearby; rentals leasing fast (median 3d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 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.
• 4 sale attempts since 25y 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 $106k; list at $400k implies a 277% gain — meaningful room to come down on a strong offer.
• By year 2, paydown + projected appreciation supports a ~$69k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 3.9% vs local median 2.7% in Auburn — 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.

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?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.