2219/2221 Dexter Ave

Ann Arbor, MI 48103

$375,000C

2 bd · 1.0 ba · 1,040 sqft · Built 1954 · MultiFamily · Active · 342 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,761/mo
• Mortgage (P&I): −$1,967
• Tax + insurance: −$815
• HOA: −$0
• Vac / Maint / Mgmt: −$790
• Net cashflow: $190/mo
• Annual: $2,277/yr
• Cap rate: 6.90%
• Cash-on-cash: 2.17%
• DSCR: 1.10
• 1% rule: 1.00%
• Cash to close: $105,000

Investor read

• This is a 2 × 1-bed/1-bath units multifamily listed at $375k.
• At list price, monthly cash flow is $190 ($2k/yr) — positive. Per door: $95/mo.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($4k rent vs $375k).
• It's been on market 342 days — a 12% lower offer ($330k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $330k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $3k of loan paydown is wiped out by about $11k of value loss. Plan a longer hold.
• Location reads 88/100 on livability (#10 in MI, #155 nationally) — a professional / high-income tenant draw. Strengths: schools A+, amenities A+, commute A+; Watch: cost of living D.
• Ann Arbor Public Schools (urban): math 71% / reading 81% proficiency, ranked #6 of 540 in MI (top 1%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Watch-outs: built in 1954 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents flat; 228 active listings in the ZIP; 22 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; high-income renter base; 996 units permitted in Washtenaw County in 2024 (492 in 5+ unit buildings).
• Washtenaw County population projected at +25% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 12 sale attempts since 12y 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 $285k; 32% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 6.9% vs local median 2.5% in Ann Arbor — 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 39% of the median local income ($116k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 342 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Can we see the unit-by-unit rent roll, current vacancy, and any below-market leases? What's the average tenancy length?
• What capital expenditures (roof, boiler, parking lot, exteriors) have been made in the last 5 years, and what's planned in the next 2?
• Built in 1954 — 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 A-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?
• 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.