167 E Lincoln Ave

Muskegon Heights, MI 49444

$164,900F

3 bd · 2.0 ba · 1,053 sqft · Built 1945 · SingleFamily · Pending · 68 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,169/mo
• Mortgage (P&I): −$865
• Tax + insurance: −$211
• HOA: −$0
• Vac / Maint / Mgmt: −$245
• Net cashflow: $-152/mo
• Annual: $-1,827/yr
• Cap rate: 5.19%
• Cash-on-cash: -3.96%
• DSCR: 0.82
• 1% rule: 0.71%
• Cash to close: $46,172

Investor read

• This is a 3-bed/2.0-bath single-family listed at $165k.
• At list price, monthly cash flow is $-152 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $138k (16.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $117k (29.1% below list).
• It's been on market 68 days — a 6% lower offer ($155k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $117k (29.1% 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 61/100 on livability (#574 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A; Watch: schools D+, crime F, amenities F.
• Watch-outs: built in 1945 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 239 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); 438 units permitted in Muskegon County in 2024 (115 in 5+ unit buildings).
• Muskegon County population projected to shrink 8% by 2050 — rents likely to lag national; underwrite the cash flow, not the appreciation.
• 6 sale attempts since 4y ago; this cycle's ask is 3% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $135k; 22% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 5.2% vs local median 8.4% in Muskegon Heights — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.

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 68 days. Have you received any prior offers? Is the seller open to a 29% concession, seller financing, or rate buy-down credit?
• Built in 1945 — 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 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?