8616 Gregory Way

Los Angeles, CA 90035

$2,299,000D

7 bd · 7.0 ba · 5,259 sqft · Built 1960 · MultiFamily · Active · 56 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $15,813/mo
• Mortgage (P&I): −$12,056
• Tax + insurance: −$1,394
• HOA: −$0
• Vac / Maint / Mgmt: −$3,321
• Net cashflow: $-958/mo
• Annual: $-11,498/yr
• Cap rate: 5.79%
• Cash-on-cash: -1.79%
• DSCR: 0.92
• 1% rule: 0.69%
• Cash to close: $643,720

Investor read

• This is a 4 × 2-bed/2.5-bath units multifamily listed at $2.30M.
• At list price, monthly cash flow is $-958 ($-11k/yr) — negative. Per door: $-240/mo.
• To cash-flow at today's rent, offer at most $2.13M (7.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $1.58M (31.2% below list).
• It's been on market 56 days — a 3% lower offer ($2.23M) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $1.58M (31.2% below list) — sets the bar for 1% rule.
• In year one you build about $78k of equity ($16k loan paydown + $62k appreciation (2.7% local appreciation)).
• 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 (-1.6%/yr); 106 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 57% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• Current owner paid $160k; list at $2.30M implies a 1337% gain — meaningful room to come down on a strong offer.
• By year 3, paydown + projected appreciation supports a ~$196k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Climate carrying-cost: extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.8% 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 $15,813/mo this rent would consume 181% of the median local household income ($105k/yr) (locally 2317% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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?
• It's been on market 56 days. Have you received any prior offers? Is the seller open to a 31% 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 1960 — 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.
• 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?