22851 Colgate St

Farmington Hills, MI 48336 3621

$215,000C-

4 bd · 2.0 ba · 1,578 sqft · Built 1947 · SingleFamily · Active · 5 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,910/mo
• Mortgage (P&I): −$1,127
• Tax + insurance: −$473
• HOA: −$0
• Vac / Maint / Mgmt: −$401
• Net cashflow: $-91/mo
• Annual: $-1,096/yr
• Cap rate: 5.78%
• Cash-on-cash: -1.82%
• DSCR: 0.92
• 1% rule: 0.89%
• Cash to close: $60,200

Investor read

• This is a 4-bed/2.0-bath single-family listed at $215k.
• At list price, monthly cash flow is $-91 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $199k (7.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $191k (11.2% below list).
• Only 5 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $191k (11.2% below list) — sets the bar for 1% rule.
• In year one you build about $8k of equity ($1k loan paydown + $6k appreciation (3.0% local appreciation)).
• Location reads 81/100 on livability (#64 in MI, #1,364 nationally) — a professional / high-income tenant draw. Strengths: employment A+, housing A+, crime A; Watch: amenities D, health & safety F.
• Farmington Public School District (urban): math 45% / reading 58% proficiency, ranked #78 of 540 in MI (top 14%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 19% free/reduced lunch — higher-income household profile.
• Watch-outs: built in 1947 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 1 active listings in the ZIP; 5 comparable units currently listed for rent nearby; rentals at typical pace (median 26d on market — plan ~3-4 weeks tenant-placement turnaround); 40% of comp listings sitting > 30 days — soft ceiling on asking rent; 2,614 units permitted in Oakland County in 2024 (721 in 5+ unit buildings).
• Oakland County population projected at +10% by 2050 — modest demand growth; plan on rents tracking national, not racing it.
• 27 sale attempts since 29y 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 $165k; 30% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• By year 5, paydown + projected appreciation supports a ~$34k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 5.8% vs local median 3.4% in Farmington Hills — 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

• 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?
• Built in 1947 — 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 B-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.
• 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.