2425 Mulberry Square Sq #42

Pontiac, MI 48302

$185,000D

2 bd · 2.0 ba · 1,443 sqft · Built 1969 · Condo · Pending · 7 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,044/mo
• Mortgage (P&I): −$970
• Tax + insurance: −$335
• HOA: −$385
• Vac / Maint / Mgmt: −$429
• Net cashflow: $-75/mo
• Annual: $-902/yr
• Cap rate: 5.81%
• Cash-on-cash: -1.74%
• DSCR: 0.92
• 1% rule: 1.10%
• Cash to close: $51,800

Investor read

• This is a 2-bed/2.0-bath condo listed at $185k.
• At list price, monthly cash flow is $-75 ($-902/yr) — negative.
• To cash-flow at today's rent, offer at most $172k (7.2% below list).
• Meets the 1% rule at list price ($2k rent vs $185k).
• Only 7 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $172k (7.2% below list) — sets the bar for cash-flow.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 64/100 on livability (#499 in MI) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: health & safety D, schools F, crime F.
• Bloomfield Hills Schools (suburban): math 65% / reading 74% proficiency, ranked #5 of 540 in MI (top 1%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 7% free/reduced lunch — higher-income household profile.
• Market conditions: 138 active listings in the ZIP; 12 comparable units currently listed for rent nearby; rentals leasing fast (median 13d on market — plan ~1-2 weeks tenant-placement turnaround); high-income renter base; 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.
• 3 sale attempts since 23y ago; this cycle's ask is 65% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Current owner paid $112k; list at $185k implies a 65% gain — meaningful room to come down on a strong offer.
• This rent is only 14% of the median local income ($178k/yr) — well below the 30% rent-burden line; pricing power to push rent on renewal without tenant pushback.

Questions for listing agent

• What do current leases actually rent for vs. the listed asking? Can we see a recent rent roll and the last 12 months of T-12 income?
• Built in 1969 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What does the HOA fee cover, when was the last increase, and are there any pending special assessments or reserve-fund shortfalls?
• Any open or pending special assessments — roof, HVAC, plumbing, elevator, façade? What's the per-unit balance and payoff schedule, and is the seller paying it off at close or rolling it to the buyer?
• 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?
• 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?