24405 137th Ave SE

Kent, WA 98042

$321,000B

5 bd · 3.0 ba · 2,940 sqft · Built 1975 · SingleFamily · Active · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $5,093/mo
• Mortgage (P&I): −$1,683
• Tax + insurance: −$776
• HOA: −$0
• Vac / Maint / Mgmt: −$1,069
• Net cashflow: $1,563/mo
• Annual: $18,761/yr
• Cap rate: 12.14%
• Cash-on-cash: 20.87%
• DSCR: 1.93
• 1% rule: 1.59%
• Cash to close: $89,880

Investor read

• This is a 5-bed/3.0-bath single-family listed at $321k.
• At list price, monthly cash flow is $2k ($19k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($5k rent vs $321k).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $10k of value loss. Plan a longer hold.
• Location reads 79/100 on livability (#109 in WA, #2,154 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, housing A+; Watch: schools C-, crime F, cost of living F.
• Kent School District (urban): math 47% / reading 57% proficiency, ranked #109 of 291 in WA (top 38%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents flat; 332 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 10,555 units permitted in King County in 2024 (7,119 in 5+ unit buildings).
• King County population projected at +44% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 17y ago; this cycle's ask has dropped $504k (61%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 0.2% rent growth), your $90k cash investment doubles in ~8 years — after that, you're playing with house money.
• Cap rate 12.1% vs local median 2.7% in Kent — 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 $5,093/mo this rent would consume 48% of the median local household income ($128k/yr) (locally 892% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1975 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.