113 Chestnut St

Munising, MI 49862

$125,000C-

3 bd · 2.0 ba · 1,474 sqft · Built 1900 · SingleFamily · Pending · 13 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,215/mo
• Mortgage (P&I): −$656
• Tax + insurance: −$208
• HOA: −$0
• Vac / Maint / Mgmt: −$255
• Net cashflow: $96/mo
• Annual: $1,153/yr
• Cap rate: 7.22%
• Cash-on-cash: 3.30%
• DSCR: 1.15
• 1% rule: 0.97%
• Cash to close: $35,000

Investor read

• This is a 3-bed/2.0-bath single-family listed at $125k. Condition is rated fair.
• At list price, monthly cash flow is $96 ($1k/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 $122k (2.8% below list).
• Only 13 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $122k (2.8% 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 69/100 on livability (#338 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: schools F, amenities F, commute F.
• Munising Public Schools (town): math 28% / reading 49% proficiency, ranked #241 of 540 in MI (top 45%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Watch-outs: built in 1900 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 57 active listings in the ZIP; 33 units permitted in Alger County in 2024 (0 in 5+ unit buildings).
• Alger County population projected at -22% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 10 sale attempts since 13y 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 $80k; list at $125k implies a 56% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: moderate flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.2% vs local median 2.6% in Munising — 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

• Have any recent inspections been done? Can we get a copy of the seller's disclosures and any deferred-maintenance estimates?
• Built in 1900 — 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 F-rated, which usually means shorter tenancies and higher turnover. Who's the typical renter profile here, and what's been the actual vacancy rate?
• 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.

Repairs flagged (vision-AI assessment)

• Major: Exterior siding — The siding is visibly worn and in poor condition.
• Minor: Kitchen cabinets — The cabinets appear dated but not structurally damaged.
• Minor: Bathroom fixtures — The fixtures seem functional but may need updating.