530 E Rainbow Rd

Newaygo, MI 49337

$105,000C+

3 bd · 2.0 ba · 1,173 sqft · Built 2009 · Other · Active · 22 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,268/mo
• Mortgage (P&I): −$551
• Tax + insurance: −$175
• HOA: −$0
• Vac / Maint / Mgmt: −$266
• Net cashflow: $276/mo
• Annual: $3,315/yr
• Cap rate: 9.45%
• Cash-on-cash: 11.28%
• DSCR: 1.50
• 1% rule: 1.21%
• Cash to close: $29,400

Investor read

• This is a 3-bed/2.0-bath other listed at $105k. Condition is rated fair.
• At list price, monthly cash flow is $276 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $105k).
• It's been on market 22 days — a 2% lower offer ($103k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $103k (1.5% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $726 of loan paydown is wiped out by about $3k of value loss. Plan a longer hold.
• Location reads 65/100 on livability (#470 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A; Watch: schools C-, crime D, amenities D-.
• Newaygo Public School District (town): math 23% / reading 40% proficiency, ranked #349 of 540 in MI (top 65%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 109 active listings in the ZIP; 155 units permitted in Newaygo County in 2024 (0 in 5+ unit buildings).
• Newaygo County population projected at -21% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $29k cash investment doubles in ~10 years — after that, you're playing with house money.
• Cap rate 9.5% vs local median 2.5% in Newaygo — 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?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Crime grade is D 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.
• 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: Paint — Faded paint on exterior
• Minor: Landscaping — Some overgrown vegetation