377 E Bear Lake Rd

Bear Lake, MI 49646

$125,000C-

2 bd · 1.0 ba · 868 sqft · Built 1974 · SingleFamily · Active · 57 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,164/mo
• Mortgage (P&I): −$656
• Tax + insurance: −$102
• HOA: −$0
• Vac / Maint / Mgmt: −$244
• Net cashflow: $162/mo
• Annual: $1,944/yr
• Cap rate: 7.85%
• Cash-on-cash: 5.56%
• DSCR: 1.25
• 1% rule: 0.93%
• Cash to close: $35,000

Investor read

• This is a 2-bed/1.0-bath single-family listed at $125k.
• At list price, monthly cash flow is $162 ($2k/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 $116k (6.9% below list).
• It's been on market 57 days — a 3% lower offer ($121k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $116k (6.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $864 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#425 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: schools D, employment D, crime D-.
• Kalkaska Public Schools (town): math 24% / reading 38% proficiency, ranked #356 of 540 in MI (top 66%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 165 active listings in the ZIP; 38 units permitted in Kalkaska County in 2024 (0 in 5+ unit buildings).
• Kalkaska County population projected to shrink 9% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 10 sale attempts since 8y ago; this cycle's ask has dropped $14k (10%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $36k; list at $125k implies a 252% gain — meaningful room to come down on a strong offer.
• Cap rate 7.8% vs local median 2.7% in Bear Lake — 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 57 days. Have you received any prior offers? Is the seller open to a 7% concession, seller financing, or rate buy-down credit?
• Built in 1974 — 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 D 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?
• 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.