418 Dawson St

Sault Ste. Marie, MI 49783

$99,000B-

4 bd · 4.0 ba · 2,320 sqft · Built 1900 · SingleFamily · Active · 219 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,415/mo
• Mortgage (P&I): −$519
• Tax + insurance: −$197
• HOA: −$0
• Vac / Maint / Mgmt: −$297
• Net cashflow: $401/mo
• Annual: $4,817/yr
• Cap rate: 11.16%
• Cash-on-cash: 17.38%
• DSCR: 1.77
• 1% rule: 1.43%
• Cash to close: $27,720

Investor read

• This is a 4-bed/4.0-bath single-family listed at $99k.
• At list price, monthly cash flow is $401 ($5k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $99k).
• It's been on market 219 days — a 12% lower offer ($87k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $87k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $684 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads: area grade B — affects rentability + tenant quality, not the cash-flow math above.
• Sault Ste. Marie Area Schools (town): math 35% / reading 44% proficiency, ranked #230 of 540 in MI (top 43%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 125 active listings in the ZIP; 92 units permitted in Chippewa County in 2024 (40 in 5+ unit buildings).
• Chippewa County population projected at -10% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• Current owner paid $63k; list at $99k implies a 57% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $28k cash investment doubles in ~7 years — after that, you're playing with house money.
• Cap rate 11.2% vs local median 4.5% in Sault Ste. Marie — 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

• It's been on market 219 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1900 — 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.
• 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.