123 W Main St SE

Caledonia, MI 49316

$185,000B

3 bd · 1.0 ba · 2,197 sqft · Built 1880 · SingleFamily · Active · 20 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,489/mo
• Mortgage (P&I): −$970
• Tax + insurance: −$239
• HOA: −$0
• Vac / Maint / Mgmt: −$523
• Net cashflow: $757/mo
• Annual: $9,087/yr
• Cap rate: 11.20%
• Cash-on-cash: 17.54%
• DSCR: 1.78
• 1% rule: 1.35%
• Cash to close: $51,800

Investor read

• This is a 3-bed/1.0-bath single-family listed at $185k.
• At list price, monthly cash flow is $757 ($9k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $185k).
• It's been on market 20 days — a 2% lower offer ($182k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $182k (1.5% below list) — sets the bar for market timing.
• 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 78/100 on livability (#101 in MI, #2,449 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, employment A+, cost of living A+; Watch: amenities F, commute F, health & safety F.
• Caledonia Community Schools (suburban): math 58% / reading 68% proficiency, ranked #26 of 540 in MI (top 5%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 13% free/reduced lunch — higher-income household profile.
• Zoned schools: Emmons Lake Elementary School (math 56% / reading 66%, grade B, #190 of 1,397 statewide, top 14%, 400 students, 24% FRL); Kraft Meadows Intermediate School (math 54% / reading 67%, grade B+, #51 of 493 statewide, top 11%, 683 students, 23% FRL); Caledonia High School (math 47% / reading 73%, grade C+, #73 of 713 statewide, top 11%, 1,464 students, 20% FRL).
• Watch-outs: built in 1880 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 257 active listings in the ZIP; 2 comparable units currently listed for rent nearby; solid renter incomes; 2,253 units permitted in Kent County in 2024 (969 in 5+ unit buildings).
• Kent County population projected at +22% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 5 sale attempts since 21y 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 $133k; 39% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $52k cash investment doubles in ~7 years — after that, you're playing with house money.
• Cap rate 11.2% vs local median 2.7% in Caledonia — 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 1880 — 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?
• 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.