11231 Otsego St

Los Angeles, CA 91601

$8,995,000C

59 bd · 65.0 ba · 32,150 sqft · Built 1974 · MultiFamily · Active · 114 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $107,792/mo
• Mortgage (P&I): −$47,171
• Tax + insurance: −$6,761
• HOA: −$0
• Vac / Maint / Mgmt: −$22,636
• Net cashflow: $31,224/mo
• Annual: $374,683/yr
• Cap rate: 10.46%
• Cash-on-cash: 14.88%
• DSCR: 1.66
• 1% rule: 1.20%
• Cash to close: $2,518,600

Investor read

• This is a 21×1bd/1ba + 21×2bd/1ba + 2×?bd/1ba units multifamily listed at $8.99M.
• At list price, monthly cash flow is $31k ($375k/yr) — positive. Per door: $710/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($108k rent vs $8.99M).
• It's been on market 114 days — a 9% lower offer ($8.19M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $8.19M (9.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $62k of loan paydown is wiped out by about $270k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#273 in CA) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, employment B; Watch: health & safety C-, schools D+, crime 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.
• Market conditions: Rents soft (-0.9%/yr); 89 active listings in the ZIP; solid renter incomes; 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.
• Climate carrying-cost: extreme-heat days projected 8→23/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 10.5% vs local median 2.1% in Los Angeles — 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 $107,792/mo this rent would consume 1625% of the median local household income ($80k/yr) (locally 5323% 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 114 days. Have you received any prior offers? Is the seller open to a 9% 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 1974 — 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?