557 Lesperance Dr

Rochester Hills, MI 48307

$13,999D+

3 bd · 1.0 ba · 1,000 sqft · Built 1974 · Other · Active · 1 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,467/mo
• Mortgage (P&I): −$73
• Tax + insurance: −$23
• HOA: −$0
• Vac / Maint / Mgmt: −$518
• Net cashflow: $1,852/mo
• Annual: $22,228/yr
• Cap rate: 165.07%
• Cash-on-cash: 567.07%
• DSCR: 26.23
• 1% rule: 17.62%
• Cash to close: $3,920

Investor read

• This is a 3-bed/1.0-bath other listed at $14k.
• At list price, monthly cash flow is $2k ($22k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $14k).
• Only 1 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $97 of loan paydown is wiped out by about $420 of value loss. Plan a longer hold.
• Location reads 77/100 on livability (#127 in MI, #3,163 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, housing A+; Watch: health & safety D, amenities F, commute F.
• Rochester Community School District (suburban): math 60% / reading 69% proficiency, ranked #21 of 540 in MI (top 4%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 10% free/reduced lunch — higher-income household profile.
• Market conditions: Rents rising (+1.8%/yr); 208 active listings in the ZIP; 11 comparable units currently listed for rent nearby; rentals at typical pace (median 15d on market — plan ~3-4 weeks tenant-placement turnaround); 45% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 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.
• At projected returns (-3.0% appreciation + 1.8% rent growth), your $4k cash investment doubles in ~1 year — after that, you're playing with house money.
• Cap rate 165.1% vs local median 3.2% in Rochester 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

• Built in 1974 — 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 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?
• 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?
• 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.