1401 S 2nd St

Mattawan, MI 49009

$180,000D

3 bd · 1.0 ba · 1,128 sqft · Built 1959 · SingleFamily · Pending · 21 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,613/mo
• Mortgage (P&I): −$944
• Tax + insurance: −$337
• HOA: −$0
• Vac / Maint / Mgmt: −$339
• Net cashflow: $-6/mo
• Annual: $-76/yr
• Cap rate: 6.25%
• Cash-on-cash: -0.15%
• DSCR: 0.99
• 1% rule: 0.90%
• Cash to close: $50,400

Investor read

• This is a 3-bed/1.0-bath single-family listed at $180k.
• At list price, monthly cash flow is $-6 ($-76/yr) — negative.
• To cash-flow at today's rent, offer at most $179k (0.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $161k (10.4% below list).
• It's been on market 21 days — a 2% lower offer ($177k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $161k (10.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 72/100 on livability (#235 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A-; Watch: crime D, amenities F, commute F.
• Mattawan Consolidated School (suburban): math 51% / reading 62% proficiency, ranked #50 of 540 in MI (top 9%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 15% free/reduced lunch — higher-income household profile.
• Watch-outs: built in 1959 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents falling (-5.0%/yr); 375 active listings in the ZIP; solid renter incomes; 339 units permitted in Kalamazoo County in 2024 (22 in 5+ unit buildings).
• Kalamazoo County population projected at +18% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts; this cycle's ask has dropped $20k (10%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Cap rate 6.3% vs local median 2.5% in Mattawan — 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

• 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?
• Built in 1959 — 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?
• 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?
• 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.