33036 Richard O Dr

Sterling Heights, MI 48310

$240,000C-

4 bd · 1.5 ba · 1,599 sqft · Built 1970 · SingleFamily · Pending · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,130/mo
• Mortgage (P&I): −$1,259
• Tax + insurance: −$359
• HOA: −$0
• Vac / Maint / Mgmt: −$447
• Net cashflow: $66/mo
• Annual: $786/yr
• Cap rate: 6.62%
• Cash-on-cash: 1.17%
• DSCR: 1.05
• 1% rule: 0.89%
• Cash to close: $67,200

Investor read

• This is a 4-bed/1.5-bath single-family listed at $240k.
• At list price, monthly cash flow is $66 ($786/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 $213k (11.2% below list).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $213k (11.2% 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 74/100 on livability (#173 in MI, #4,545 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: health & safety D+, amenities F.
• Warren Consolidated Schools (urban): math 18% / reading 39% proficiency, ranked #373 of 540 in MI (top 69%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Zoned schools: Grissom Middle School (math 11% / reading 36%, grade F, #399 of 493 statewide, top 81%, 697 students, 84% FRL); Warren Mott High School (math 12% / reading 40%, grade F, #474 of 713 statewide, top 66%, 1,385 students, 73% FRL) — zoned schools average 78% FRL vs 48% district-wide (30 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising fast (+6.5%/yr); 137 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 1,321 units permitted in Macomb County in 2024 (86 in 5+ unit buildings).
• Macomb County population projected at +9% 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.
• Cap rate 6.6% vs local median 3.8% in Sterling Heights — 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 runs 33% of the median local income ($78k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1970 — 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.
• 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.