1377 Dorothea Rd

Berkley, MI 48072

$249,000D

2 bd · 1.0 ba · 970 sqft · Built 1929 · SingleFamily · Active · 39 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,849/mo
• Mortgage (P&I): −$1,306
• Tax + insurance: −$401
• HOA: −$0
• Vac / Maint / Mgmt: −$388
• Net cashflow: $-246/mo
• Annual: $-2,950/yr
• Cap rate: 5.11%
• Cash-on-cash: -4.23%
• DSCR: 0.81
• 1% rule: 0.74%
• Cash to close: $69,720

Investor read

• This is a 2-bed/1.0-bath single-family listed at $249k.
• At list price, monthly cash flow is $-246 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $206k (17.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $185k (25.7% below list).
• It's been on market 39 days — a 3% lower offer ($242k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $185k (25.7% 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 $7k of value loss. Plan a longer hold.
• Location reads 92/100 on livability (#1 in MI, #33 nationally) — a professional / high-income tenant draw. Strengths: schools A+, crime A+, commute A+.
• Berkley School District (suburban): math 47% / reading 62% proficiency, ranked #64 of 540 in MI (top 12%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 18% free/reduced lunch — higher-income household profile.
• Watch-outs: built in 1929 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 89 active listings in the ZIP; 31 comparable units currently listed for rent nearby; rentals at typical pace (median 25d 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.
• 2 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 $129k; list at $249k implies a 93% gain — meaningful room to come down on a strong offer.
• Cap rate 5.1% vs local median 3.9% in Berkley — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

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 26% concession, seller financing, or rate buy-down credit?
• Built in 1929 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Schools are A-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.
• 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.