2970 Valley St

Norton Shores, MI 49444

$127,900D+

3 bd · 1.0 ba · 792 sqft · Built 1942 · SingleFamily · Active · 23 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,264/mo
• Mortgage (P&I): −$671
• Tax + insurance: −$246
• HOA: −$0
• Vac / Maint / Mgmt: −$265
• Net cashflow: $82/mo
• Annual: $979/yr
• Cap rate: 7.06%
• Cash-on-cash: 2.73%
• DSCR: 1.12
• 1% rule: 0.99%
• Cash to close: $35,812

Investor read

• This is a 3-bed/1.0-bath single-family listed at $128k.
• At list price, monthly cash flow is $82 ($979/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $126k (1.2% below list).
• It's been on market 23 days — a 2% lower offer ($126k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $126k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $884 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#310 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, crime B; Watch: amenities F, commute F, health & safety F.
• Muskegon Public Schools Of The City Of (urban): math 4% / reading 12% proficiency, ranked #534 of 540 in MI (top 99%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 81% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Muskegon Middle School (math 4% / reading 13%, grade F, #480 of 493 statewide, top 97%, 755 students, 87% FRL); Muskegon High School (math 8% / reading 27%, grade F, #632 of 713 statewide, top 89%, 1,039 students, 84% FRL) — zoned schools at 85% FRL track the district average.
• Watch-outs: built in 1942 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 239 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 438 units permitted in Muskegon County in 2024 (115 in 5+ unit buildings).
• Muskegon County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 8 sale attempts since 6y 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.
• Current owner paid $89k; 44% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 7.1% vs local median 3.3% in Norton Shores — 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

• Built in 1942 — 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 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?
• The area grade is low — what's the realistic commute time and amenity access for the typical tenant pool here? Any planned neighborhood developments (good or bad) we should know about?
• 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.