4223 Burton St SE

Kentwood, MI 49546

$389,900D

3 bd · 1.5 ba · 2,541 sqft · Built 1964 · SingleFamily · Active · 104 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,718/mo
• Mortgage (P&I): −$2,045
• Tax + insurance: −$451
• HOA: −$0
• Vac / Maint / Mgmt: −$571
• Net cashflow: $-349/mo
• Annual: $-4,184/yr
• Cap rate: 5.22%
• Cash-on-cash: -3.83%
• DSCR: 0.83
• 1% rule: 0.70%
• Cash to close: $109,172

Investor read

• This is a 3-bed/1.5-bath single-family listed at $390k.
• At list price, monthly cash flow is $-349 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $328k (15.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $272k (30.3% below list).
• It's been on market 104 days — a 9% lower offer ($355k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $272k (30.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $12k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#191 in MI, #4,892 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A-; Watch: commute C-, crime D, amenities F.
• Forest Hills Public Schools (suburban): math 65% / reading 74% proficiency, ranked #11 of 540 in MI (top 2%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 8% free/reduced lunch — higher-income household profile.
• Zoned schools: Meadow Brook Elementary School (math 67% / reading 52%, grade B-, #200 of 1,397 statewide, top 16%, 463 students, 24% FRL); Northern Hills Middle School (math 64% / reading 80%, grade A, #21 of 493 statewide, top 5%, 546 students, 17% FRL); Northern High School (math 57% / reading 81%, grade B, #38 of 713 statewide, top 5%, 1,134 students, 16% FRL).
• Market conditions: Rents rising fast (+6.0%/yr); 114 active listings in the ZIP; 2 comparable units currently listed for rent nearby; solid renter incomes; 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.
• 9 sale attempts since 35y ago; this cycle's ask has dropped $25k (6%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $85k; list at $390k implies a 359% gain — meaningful room to come down on a strong offer.
• Cap rate 5.2% vs local median 3.5% in Kentwood — 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.
• This rent runs 33% of the median local income ($99k/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 104 days. Have you received any prior offers? Is the seller open to a 30% concession, seller financing, or rate buy-down credit?
• Built in 1964 — 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 A-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• Crime grade is D 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?