31009 Heritage Hills Dr

Farmington Hills, MI 48331

$314,900D

4 bd · 2.5 ba · 2,386 sqft · Built 1968 · SingleFamily · Pending · 39 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,658/mo
• Mortgage (P&I): −$1,651
• Tax + insurance: −$768
• HOA: −$29
• Vac / Maint / Mgmt: −$558
• Net cashflow: $-349/mo
• Annual: $-4,185/yr
• Cap rate: 4.96%
• Cash-on-cash: -4.75%
• DSCR: 0.79
• 1% rule: 0.84%
• Cash to close: $88,172

Investor read

• This is a 4-bed/2.5-bath single-family listed at $315k.
• At list price, monthly cash flow is $-349 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $253k (19.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $266k (15.6% below list).
• It's been on market 39 days — a 3% lower offer ($305k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $253k (19.6% 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 $9k of value loss. Plan a longer hold.
• Location reads 81/100 on livability (#64 in MI, #1,364 nationally) — a professional / high-income tenant draw. Strengths: employment A+, housing A+, crime A; Watch: amenities D, health & safety F.
• Farmington Public School District (urban): math 45% / reading 58% proficiency, ranked #78 of 540 in MI (top 14%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 19% free/reduced lunch — higher-income household profile.
• Zoned schools: Forest Elementary School (math 57% / reading 62%, grade B-, #200 of 1,397 statewide, top 16%, 397 students, 19% FRL); Warner Middle School (math 37% / reading 56%, grade D+, #150 of 493 statewide, top 31%, 571 students, 34% FRL); North Farmington High School (math 48% / reading 67%, grade C, #95 of 713 statewide, top 14%, 1,268 students, 30% FRL).
• Market conditions: Rents rising fast (+9.7%/yr); 89 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 2,614 units permitted in Oakland County in 2024 (721 in 5+ unit buildings).
• Oakland County population projected at +10% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 13 sale attempts since 28y ago; this cycle's ask has dropped $55k (15%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Cap rate 5.0% vs local median 3.4% in Farmington Hills — 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.

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 39 days. Have you received any prior offers? Is the seller open to a 20% concession, seller financing, or rate buy-down credit?
• Built in 1968 — 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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are B-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?
• 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.