20 Park Pl

Pontiac, MI 48342

$130,000B

3 bd · 2.0 ba · 1,770 sqft · Built 1920 · SingleFamily · Pending · 88 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,780/mo
• Mortgage (P&I): −$682
• Tax + insurance: −$188
• HOA: −$0
• Vac / Maint / Mgmt: −$374
• Net cashflow: $537/mo
• Annual: $6,441/yr
• Cap rate: 11.25%
• Cash-on-cash: 17.70%
• DSCR: 1.79
• 1% rule: 1.37%
• Cash to close: $36,400

Investor read

• This is a 3-bed/2.0-bath single-family listed at $130k.
• At list price, monthly cash flow is $537 ($6k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $130k).
• It's been on market 88 days — a 6% lower offer ($122k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $122k (6.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $899 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#499 in MI) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: health & safety D, schools F, crime F.
• Pontiac City School District (urban): math 8% / reading 17% proficiency, ranked #514 of 540 in MI (top 95%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 81% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 87 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals at typical pace (median 18d on market — plan ~3-4 weeks tenant-placement turnaround); 2,614 units permitted in Oakland County in 2024 (721 in 5+ unit buildings).
• Oakland County population projected at +10% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 5 sale attempts since 4y ago; this cycle's ask has dropped $50k (28%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $111k; 17% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $36k cash investment doubles in ~7 years — after that, you're playing with house money.
• Cap rate 11.2% vs local median 6.7% in Pontiac — 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

• It's been on market 88 days. Have you received any prior offers? Is the seller open to a 6% concession, seller financing, or rate buy-down credit?
• Built in 1920 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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.