1475 25th St

Detroit, MI 48216

$234,900F

7 bd · 1.5 ba · 1,779 sqft · Built 1900 · Townhouse · Active · 33 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,182/mo
• Mortgage (P&I): −$1,232
• Tax + insurance: −$797
• HOA: −$0
• Vac / Maint / Mgmt: −$458
• Net cashflow: $-305/mo
• Annual: $-3,658/yr
• Cap rate: 4.74%
• Cash-on-cash: -5.56%
• DSCR: 0.75
• 1% rule: 0.93%
• Cash to close: $65,772

Investor read

• This is a 7-bed/1.5-bath townhouse listed at $235k.
• At list price, monthly cash flow is $-305 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $181k (22.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $218k (7.1% below list).
• It's been on market 33 days — a 3% lower offer ($228k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $181k (22.9% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k 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: property tax is 3.6% of price; built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+7.3%/yr); 105 active listings in the ZIP; 1 comparable units currently listed for rent nearby; lower-income renter base — watch delinquency; 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.
• 6 sale attempts 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.
• Cap rate 4.7% vs local median 10.2% in Detroit — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.
• At $2,182/mo this rent would consume 59% of the median local household income ($44k/yr) (locally 431% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 33 days. Have you received any prior offers? Is the seller open to a 23% concession, seller financing, or rate buy-down credit?
• Built in 1900 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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?