623 Cherry St SE

Grand Rapids, MI 49503

$689,900D+

25 bd · 25.0 ba · — sqft · Built 1875 · MultiFamily · Active · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $6,998/mo
• Mortgage (P&I): −$3,618
• Tax + insurance: −$1,150
• HOA: −$0
• Vac / Maint / Mgmt: −$1,470
• Net cashflow: $761/mo
• Annual: $9,128/yr
• Cap rate: 7.62%
• Cash-on-cash: 4.73%
• DSCR: 1.21
• 1% rule: 1.01%
• Cash to close: $193,172

Investor read

• This is a 5 × 1-bed/1.0-bath units multifamily listed at $690k.
• At list price, monthly cash flow is $761 ($9k/yr) — positive. Per door: $152/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($7k rent vs $690k).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $5k of loan paydown is wiped out by about $21k of value loss. Plan a longer hold.
• Location reads 83/100 on livability (#44 in MI, #939 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: employment C-, crime F.
• Grand Rapids Public Schools (urban): math 15% / reading 29% proficiency, ranked #451 of 540 in MI (top 84%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 80% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1875 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.8%/yr); 181 active listings in the ZIP; 2,253 units permitted in Kent County in 2024 (969 in 5+ unit buildings).
• Kent County population projected at +22% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 10 sale attempts since 38y 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 $170k; list at $690k implies a 306% gain — meaningful room to come down on a strong offer.
• Cap rate 7.6% vs local median 4.5% in Grand Rapids — 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.
• At $6,998/mo this rent would consume 130% of the median local household income ($65k/yr) (locally 1891% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1875 — 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.
• 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.