5157 N William St

Fountain, MI 49410

$94,000D

1 bd · 1.0 ba · 500 sqft · Built 1940 · Other · Pending · 8 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $783/mo
• Mortgage (P&I): −$493
• Tax + insurance: −$157
• HOA: −$0
• Vac / Maint / Mgmt: −$165
• Net cashflow: $-31/mo
• Annual: $-368/yr
• Cap rate: 5.90%
• Cash-on-cash: -1.40%
• DSCR: 0.94
• 1% rule: 0.83%
• Cash to close: $26,320

Investor read

• This is a 1-bed/1.0-bath other listed at $94k.
• At list price, monthly cash flow is $-31 ($-368/yr) — negative.
• To cash-flow at today's rent, offer at most $90k (4.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $78k (16.7% below list).
• Only 8 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $78k (16.7% below list) — sets the bar for 1% rule.
• In year one you build about $3k of equity ($650 loan paydown + $2k appreciation (2.6% local appreciation)).
• Location reads 61/100 on livability (#569 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: crime F, amenities F, commute F.
• Mason County Eastern Schools (rural): math 26% / reading 40% proficiency, ranked #496 of 760 in MI (top 65%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Mason County Eastern Elem Sch (math 27% / reading 37%, grade F, #814 of 1,397 statewide, top 61%, 211 students, 78% FRL); Mason County Eastern Junior Highhigh School (math 32% / reading 47%, grade F, #304 of 713 statewide, top 46%, 171 students, 59% FRL).
• Watch-outs: built in 1940 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 28 active listings in the ZIP; 177 units permitted in Mason County in 2024 (97 in 5+ unit buildings).
• Mason County population projected to shrink 9% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 10 sale attempts since 20y 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 $50k; list at $94k implies a 88% gain — meaningful room to come down on a strong offer.
• At projected returns (2.6% appreciation + 3.0% rent growth), your $26k cash investment doubles in ~8 years — after that, you're playing with house money.
• By year 10, paydown + projected appreciation supports a ~$30k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.

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 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 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?
• 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.