2035 N US-31 N #2502

Traverse City, MI 49686

$12,800D+

2 bd · 2.0 ba · 1,060 sqft · Built 2006 · Condo · Active · 15 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,837/mo
• Mortgage (P&I): −$67
• Tax + insurance: −$21
• HOA: −$51
• Vac / Maint / Mgmt: −$386
• Net cashflow: $1,312/mo
• Annual: $15,744/yr
• Cap rate: 129.29%
• Cash-on-cash: 439.28%
• DSCR: 20.55
• 1% rule: 14.35%
• Cash to close: $3,584

Investor read

• This is a 2-bed/2.0-bath condo listed at $13k.
• At list price, monthly cash flow is $1k ($16k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $13k).
• It's been on market 15 days — a 2% lower offer ($13k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $13k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $88 of loan paydown is wiped out by about $384 of value loss. Plan a longer hold.
• Location reads 91/100 on livability (#4 in MI, #46 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, housing A+.
• Traverse City Area Public Schools (town): math 45% / reading 56% proficiency, ranked #94 of 540 in MI (top 17%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Market conditions: Rents soft (-0.5%/yr); 322 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 883 units permitted in Grand Traverse County in 2024 (501 in 5+ unit buildings).
• Grand Traverse County population projected at +20% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 12 sale attempts since 3y ago; this cycle's ask is 574% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $750; list at $13k implies a 1607% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 0.0% rent growth), your $4k cash investment doubles in ~1 year — after that, you're playing with house money.
• Cap rate 129.3% vs local median 1.7% in Traverse 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.
• This rent runs 31% of the median local income ($72k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are A-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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.