605 S Barclay St

Bay City, MI 48706

$89,900B

3 bd · 1.0 ba · 832 sqft · Built 1940 · SingleFamily · Pending · 21 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,305/mo
• Mortgage (P&I): −$471
• Tax + insurance: −$158
• HOA: −$0
• Vac / Maint / Mgmt: −$274
• Net cashflow: $401/mo
• Annual: $4,813/yr
• Cap rate: 11.65%
• Cash-on-cash: 19.12%
• DSCR: 1.85
• 1% rule: 1.45%
• Cash to close: $25,172

Investor read

• This is a 3-bed/1.0-bath single-family listed at $90k.
• At list price, monthly cash flow is $401 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $90k).
• It's been on market 21 days — a 2% lower offer ($89k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $89k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $622 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#360 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: amenities D, crime F, commute F.
• Bay City School District (urban): math 27% / reading 40% proficiency, ranked #317 of 540 in MI (top 59%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Kolb Elementary School (math 37% / reading 42%, grade F, #606 of 1,397 statewide, top 48%, 477 students, 72% FRL); Handy Middle School (math 17% / reading 33%, grade F, #387 of 493 statewide, top 78%, 685 students, 79% FRL); Bay City Central High School (math 22% / reading 47%, grade F, #372 of 713 statewide, top 56%, 1,033 students, 64% FRL) — zoned schools average 72% FRL vs 44% district-wide (28 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Watch-outs: built in 1940 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 248 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 39 units permitted in Bay County in 2024 (0 in 5+ unit buildings).
• Bay County population projected at -21% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 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.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $25k cash investment doubles in ~7 years — after that, you're playing with house money.
• Cap rate 11.6% vs local median 6.5% in Bay 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

• Built in 1940 — 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?
• 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.