32005 W 12 Mile Rd #204

Farmington Hills, MI 48334

$110,000C-

1 bd · 1.0 ba · 887 sqft · Built 1978 · Condo · Active · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,295/mo
• Mortgage (P&I): −$577
• Tax + insurance: −$90
• HOA: −$266
• Vac / Maint / Mgmt: −$272
• Net cashflow: $90/mo
• Annual: $1,077/yr
• Cap rate: 7.27%
• Cash-on-cash: 3.50%
• DSCR: 1.16
• 1% rule: 1.18%
• Cash to close: $30,800

Investor read

• This is a 1-bed/1.0-bath condo listed at $110k.
• At list price, monthly cash flow is $90 ($1k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $110k).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $761 of loan paydown is wiped out by about $3k 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: Kenbrook Elementary School (math 52% / reading 47%, grade D, #382 of 1,397 statewide, top 30%, 392 students, 32% 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).
• Watch-outs: HOA is 21% of rent.
• Market conditions: 93 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 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.
• 6 sale attempts since 2y ago; this cycle's ask is 8700% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Cap rate 7.3% 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.
• This rent is only 15% of the median local income ($102k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

Questions for listing agent

• Built in 1978 — 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?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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?
• 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 apartment / multifamily construction is in the pipeline within 1–3 miles? Heavy new supply (>2% of stock underway) typically softens rents 12–24 months out; light construction supports rent growth.