517 S Pennsylvania Ave

Lansing, MI 48912

$123,000D-

2 bd · 1.5 ba · 1,176 sqft · Built 2026 · Townhouse · Active · 186 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,198/mo
• Mortgage (P&I): −$708
• Tax + insurance: −$225
• HOA: −$165
• Vac / Maint / Mgmt: −$252
• Net cashflow: $-151/mo
• Annual: $-1,816/yr
• Cap rate: 4.95%
• Cash-on-cash: -4.81%
• DSCR: 0.79
• 1% rule: 0.89%
• Cash to close: $37,782

Investor read

• This is a 2-bed/1.5-bath townhouse listed at $123k. Condition is rated good.
• At list price, monthly cash flow is $-151 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $113k (8.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $120k (2.6% below list).
• It's been on market 186 days — a 12% lower offer ($108k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $108k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $933 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 79/100 on livability (#94 in MI, #2,182 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, cost of living A+; Watch: employment D, crime F.
• Lansing Public School District (urban): math 14% / reading 23% proficiency, ranked #650 of 760 in MI (top 86%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 68% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Pattengill School (600 students, 88% FRL) — zoned schools average 88% FRL vs 68% district-wide (21 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising fast (+7.0%/yr); 227 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals lingering (median 38d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 55% of comp listings sitting > 30 days — soft ceiling on asking rent; 350 units permitted in Ingham County in 2024 (186 in 5+ unit buildings).
• Ingham County population projected at +11% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 2 sale attempts 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.

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?
• It's been on market 186 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• 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 F-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?
• 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?