3294 Butternut Dr

Beechwood, MI 49424

$265,000D

3 bd · 1.5 ba · 1,196 sqft · Built 2016 · SingleFamily · Pending · 5 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,001/mo
• Mortgage (P&I): −$1,390
• Tax + insurance: −$348
• HOA: −$0
• Vac / Maint / Mgmt: −$420
• Net cashflow: $-157/mo
• Annual: $-1,879/yr
• Cap rate: 5.58%
• Cash-on-cash: -2.53%
• DSCR: 0.89
• 1% rule: 0.76%
• Cash to close: $74,200

Investor read

• This is a 3-bed/1.5-bath single-family listed at $265k.
• At list price, monthly cash flow is $-157 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $237k (10.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $200k (24.5% below list).
• Only 5 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $200k (24.5% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $8k of value loss. Plan a longer hold.
• Location reads 86/100 on livability (#21 in MI, #378 nationally) — a professional / high-income tenant draw. Strengths: crime A+, cost of living A+, housing A+; Watch: employment D.
• West Ottawa Public School District (suburban): math 37% / reading 52% proficiency, ranked #140 of 540 in MI (top 26%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Great Lakes Elementary School (math 29% / reading 39%, grade F, #798 of 1,397 statewide, top 57%, 409 students, 74% FRL); Harbor Lights Middle School (math 38% / reading 53%, grade D+, #161 of 493 statewide, top 33%, 817 students, 52% FRL); West Ottawa High School Campus (math 39% / reading 62%, grade D+, #146 of 713 statewide, top 21%, 2,196 students, 51% FRL).
• Market conditions: Rents rising fast (+5.1%/yr); 346 active listings in the ZIP; 2 comparable units currently listed for rent nearby; solid renter incomes; 1,237 units permitted in Ottawa County in 2024 (443 in 5+ unit buildings).
• Ottawa County population projected at +24% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 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.
• Current owner paid $24k; list at $265k implies a 1004% gain — meaningful room to come down on a strong offer.
• Cap rate 5.6% vs local median 3.6% in Beechwood — 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?
• 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?
• 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.
• 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.