302 First St

Ludington, MI 49431

$155,000D-

2 bd · 1.0 ba · 1,162 sqft · Built 1897 · SingleFamily · Active · 370 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,012/mo
• Mortgage (P&I): −$813
• Tax + insurance: −$258
• HOA: −$0
• Vac / Maint / Mgmt: −$212
• Net cashflow: $-272/mo
• Annual: $-3,264/yr
• Cap rate: 4.19%
• Cash-on-cash: -7.52%
• DSCR: 0.67
• 1% rule: 0.65%
• Cash to close: $43,400

Investor read

• This is a 2-bed/1.0-bath single-family listed at $155k.
• At list price, monthly cash flow is $-272 ($-3k/yr) — negative.
• To cash-flow at today's rent, offer at most $116k (25.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $101k (34.7% below list).
• It's been on market 370 days — a 12% lower offer ($136k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $101k (34.7% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 83/100 on livability (#43 in MI, #921 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, cost of living A+, housing A+; Watch: commute F, employment D-.
• Ludington Area School District (town): math 37% / reading 50% proficiency, ranked #172 of 540 in MI (top 32%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Ludington Elementary School (math 33% / reading 40%, grade F, #720 of 1,397 statewide, top 52%, 900 students, 58% FRL); Oj Dejonge Middle School (math 40% / reading 57%, grade C-, #133 of 493 statewide, top 28%, 477 students, 49% FRL); Ludington High School (math 42% / reading 62%, grade D+, #128 of 713 statewide, top 19%, 695 students, 44% FRL).
• Watch-outs: built in 1897 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 173 active listings in the ZIP; 177 units permitted in Mason County in 2024 (97 in 5+ unit buildings).
• Mason County population projected to shrink 9% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 3 sale attempts; this cycle's ask has dropped $15k (9%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Cap rate 4.2% vs local median 1.4% in Ludington — 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 370 days. Have you received any prior offers? Is the seller open to a 35% concession, seller financing, or rate buy-down credit?
• Built in 1897 — 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.
• 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.