141 Reed St

Kalamazoo, MI 49001

$104,900B

3 bd · 2.0 ba · 1,764 sqft · Built 1907 · SingleFamily · Active · 29 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,194/mo
• Mortgage (P&I): −$550
• Tax + insurance: −$335
• HOA: −$0
• Vac / Maint / Mgmt: −$461
• Net cashflow: $848/mo
• Annual: $10,181/yr
• Cap rate: 16.00%
• Cash-on-cash: 34.66%
• DSCR: 2.54
• 1% rule: 2.09%
• Cash to close: $29,372

Investor read

• This is a 3-bed/2.0-bath single-family listed at $105k.
• At list price, monthly cash flow is $848 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $105k).
• It's been on market 29 days — a 2% lower offer ($103k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $103k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $725 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 76/100 on livability (#141 in MI, #3,492 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: crime F, employment D-.
• Kalamazoo Public Schools (urban): math 43% / reading 72% proficiency, ranked #71 of 540 in MI (top 13%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; 66% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: property tax is 3.3% of price; built in 1907 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+6.4%/yr); 109 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals leasing fast (median 14d on market — plan ~1-2 weeks tenant-placement turnaround); 339 units permitted in Kalamazoo County in 2024 (22 in 5+ unit buildings).
• Kalamazoo County population projected at +18% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 23 sale attempts since 32y ago; this cycle's ask has dropped $10k (9%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (-3.0% appreciation + 6.4% rent growth), your $29k cash investment doubles in ~4 years — after that, you're playing with house money.
• Cap rate 16.0% vs local median 4.1% in Kalamazoo — 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 $2,194/mo this rent would consume 47% of the median local household income ($56k/yr) (locally 1184% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1907 — 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.
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.