6533 East Jefferson Ave #238

Detroit, MI 48207

$110,000D

1 bd · 1.0 ba · 1,191 sqft · Built 1906 · Condo · Active · 121 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,582/mo
• Mortgage (P&I): −$577
• Tax + insurance: −$183
• HOA: −$805
• Vac / Maint / Mgmt: −$332
• Net cashflow: $-315/mo
• Annual: $-3,782/yr
• Cap rate: 2.85%
• Cash-on-cash: -12.28%
• DSCR: 0.45
• 1% rule: 1.44%
• Cash to close: $30,800

Investor read

• This is a 1-bed/1.0-bath condo listed at $110k. Condition is rated good.
• At list price, monthly cash flow is $-315 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $64k (41.5% below list).
• Meets the 1% rule at list price ($2k rent vs $110k).
• It's been on market 121 days — a 12% lower offer ($97k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $64k (41.5% below list) — sets the bar for cash-flow.
• Local home prices are declining (-2.8%/yr); year-one equity from $761 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#218 in MI) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, cost of living A+; Watch: schools F, crime F, employment F.
• Detroit Public Schools Community District (urban): math 10% / reading 24% proficiency, ranked #499 of 540 in MI (top 92%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 90% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: HOA is 51% of rent; built in 1906 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+3.5%/yr); 245 active listings in the ZIP; 40 comparable units currently listed for rent nearby; rentals lingering (median 45d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; 2,639 units permitted in Wayne County in 2024 (1,216 in 5+ unit buildings).
• Wayne County population projected at -17% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts; this cycle's ask has dropped $15k (12%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Cap rate 2.9% vs local median 10.1% in Detroit — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.
• This rent runs 40% of the median local income ($48k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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 121 days. Have you received any prior offers? Is the seller open to a 41% concession, seller financing, or rate buy-down credit?
• Built in 1906 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• 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?