846 Catherine Ave

Muskegon, MI 49442

$84,700B+

4 bd · 1.0 ba · 1,308 sqft · Built 1920 · SingleFamily · Pending · 352 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,548/mo
• Mortgage (P&I): −$444
• Tax + insurance: −$237
• HOA: −$0
• Vac / Maint / Mgmt: −$325
• Net cashflow: $541/mo
• Annual: $6,493/yr
• Cap rate: 13.96%
• Cash-on-cash: 27.38%
• DSCR: 2.22
• 1% rule: 1.83%
• Cash to close: $23,716

Investor read

• This is a 4-bed/1.0-bath single-family listed at $85k.
• At list price, monthly cash flow is $541 ($6k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $85k).
• It's been on market 352 days — a 12% lower offer ($75k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $75k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $586 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 79/100 on livability (#92 in MI, #2,096 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, cost of living A+; Watch: schools D-, crime F, employment F.
• Muskegon Public Schools Of The City Of (urban): math 4% / reading 12% proficiency, ranked #534 of 540 in MI (top 99%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 81% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: property tax is 2.9% of price; built in 1920 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+8.2%/yr); 289 active listings in the ZIP; 8 comparable units currently listed for rent nearby; rentals at typical pace (median 22d 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.
• 11 sale attempts since 30y ago; this cycle's ask has dropped $45k (35%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $74k; 15% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 8.0% rent growth), your $24k cash investment doubles in ~4 years — after that, you're playing with house money.
• Cap rate 14.0% vs local median 4.6% in Muskegon — 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 38% of the median local income ($49k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 352 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1920 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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?
• 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.