309 S Warner St

Bay City, MI 48706

$127,000D+

3 bd · 1.0 ba · 1,174 sqft · Built 1899 · SingleFamily · Active · 21 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,166/mo
• Mortgage (P&I): −$666
• Tax + insurance: −$231
• HOA: −$0
• Vac / Maint / Mgmt: −$245
• Net cashflow: $24/mo
• Annual: $293/yr
• Cap rate: 6.52%
• Cash-on-cash: 0.82%
• DSCR: 1.04
• 1% rule: 0.92%
• Cash to close: $35,560

Investor read

• This is a 3-bed/1.0-bath single-family listed at $127k.
• At list price, monthly cash flow is $24 ($293/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $117k (8.2% below list).
• It's been on market 21 days — a 2% lower offer ($125k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $117k (8.2% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $878 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#360 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: schools D+, amenities D, crime F.
• Bay City School District (urban): math 27% / reading 40% proficiency, ranked #317 of 540 in MI (top 59%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1899 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 246 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 100% of comp listings sitting > 30 days — soft ceiling on asking rent; 39 units permitted in Bay County in 2024 (0 in 5+ unit buildings).
• Bay County population projected at -21% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 4 sale attempts since 22y ago 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 $40k; list at $127k implies a 217% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major flood risk — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• Built in 1899 — 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 D-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• 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.