1239 Livernois Ave

Detroit, MI 48209

$111,000B-

3 bd · 1.0 ba · 1,480 sqft · Built 1915 · SingleFamily · Pending · 50 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,298/mo
• Mortgage (P&I): −$582
• Tax + insurance: −$297
• HOA: −$0
• Vac / Maint / Mgmt: −$273
• Net cashflow: $147/mo
• Annual: $1,758/yr
• Cap rate: 7.88%
• Cash-on-cash: 5.66%
• DSCR: 1.25
• 1% rule: 1.17%
• Cash to close: $31,080

Investor read

• This is a 3-bed/1.0-bath single-family listed at $111k.
• At list price, monthly cash flow is $147 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $111k).
• It's been on market 50 days — a 3% lower offer ($108k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $108k (3.0% below list) — sets the bar for market timing.
• In year one you build about $12k of equity ($767 loan paydown + $11k appreciation (10.0% local appreciation)).
• Location reads 73/100 on livability (#218 in MI) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, cost of living A+; Watch: schools F, crime F, employment F.
• Detroit Public Schools Community District (urban): math 10% / reading 24% proficiency, ranked #499 of 540 in MI (top 92%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 90% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: property tax is 2.7% of price; built in 1915 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 66 active listings in the ZIP; 7 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 57% of comp listings sitting > 30 days — soft ceiling on asking rent; lower-income renter base — watch delinquency; 2,639 units permitted in Wayne County in 2024 (1,216 in 5+ unit buildings).
• Wayne County population projected at -17% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 5 sale attempts since 19y 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 $13k; list at $111k implies a 754% gain — meaningful room to come down on a strong offer.
• At projected returns (10.0% appreciation + 3.0% rent growth), your $31k cash investment doubles in ~3 years — after that, you're playing with house money.
• By year 3, paydown + projected appreciation supports a ~$30k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 7.9% vs local median 10.2% in Detroit — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.
• This rent runs 36% of the median local income ($43k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 50 days. Have you received any prior offers? Is the seller open to a 3% concession, seller financing, or rate buy-down credit?
• Built in 1915 — 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?
• 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?
• 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.
• 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.