3935 E Cesar E Chavez

East Los Angeles, CA 90063

$699,999C-

20 bd · None ba · 1,645 sqft · Built 1930 · MultiFamily · Active · 145 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $8,060/mo
• Mortgage (P&I): −$3,671
• Tax + insurance: −$1,167
• HOA: −$0
• Vac / Maint / Mgmt: −$1,693
• Net cashflow: $1,530/mo
• Annual: $18,358/yr
• Cap rate: 8.92%
• Cash-on-cash: 9.37%
• DSCR: 1.42
• 1% rule: 1.15%
• Cash to close: $196,000

Investor read

• This is a 1×3bd/1ba + 1×1bd/1ba + 2×?bd/1ba units multifamily listed at $700k.
• At list price, monthly cash flow is $2k ($18k/yr) — positive. Per door: $382/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($8k rent vs $700k).
• It's been on market 145 days — a 12% lower offer ($616k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $616k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $5k of loan paydown is wiped out by about $21k of value loss. Plan a longer hold.
• Location reads 60/100 on livability (#594 in CA) — a middle-class / working-renter tenant base. Strengths: commute A+, schools B+; Watch: employment C-, health & safety 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.
• Watch-outs: built in 1930 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents falling (-3.3%/yr); 80 active listings in the ZIP; 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.
• 17 sale attempts since 13y 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.
• Cap rate 8.9% vs local median 3.5% in East 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 $8,060/mo this rent would consume 133% of the median local household income ($73k/yr) (locally 1857% 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 145 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 1930 — 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 B-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?