21704 W North Ave

Reed City, MI 49677

$95,000B+

3 bd · 1.0 ba · 1,300 sqft · Built 1971 · SingleFamily · Pending · 78 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,500/mo
• Mortgage (P&I): −$498
• Tax + insurance: −$158
• HOA: −$0
• Vac / Maint / Mgmt: −$315
• Net cashflow: $528/mo
• Annual: $6,342/yr
• Cap rate: 12.97%
• Cash-on-cash: 23.84%
• DSCR: 2.06
• 1% rule: 1.58%
• Cash to close: $26,600

Investor read

• This is a 3-bed/1.0-bath single-family listed at $95k.
• At list price, monthly cash flow is $528 ($6k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $95k).
• It's been on market 78 days — a 6% lower offer ($89k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $89k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $657 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#316 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: schools D+, crime D, amenities F.
• Reed City Area Public Schools (rural): math 30% / reading 39% proficiency, ranked #311 of 540 in MI (top 58%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 61 active listings in the ZIP; 1 comparable units currently listed for rent nearby; 5 units permitted in Osceola County in 2024 (0 in 5+ unit buildings).
• Osceola County population projected at -24% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 8 sale attempts since 10y ago; this cycle's ask has dropped $14k (13%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $26k; list at $95k implies a 265% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $27k cash investment doubles in ~6 years — after that, you're playing with house money.
• Cap rate 13.0% vs local median 3.8% in Reed City — 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

• It's been on market 78 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Built in 1971 — 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 D 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.