229 5th St

Burr Oak, MI 49030

$128,000D

2 bd · 1.0 ba · 960 sqft · Built 1924 · SingleFamily · Active · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $900/mo
• Mortgage (P&I): −$671
• Tax + insurance: −$124
• HOA: −$0
• Vac / Maint / Mgmt: −$189
• Net cashflow: $-84/mo
• Annual: $-1,007/yr
• Cap rate: 5.51%
• Cash-on-cash: -2.81%
• DSCR: 0.87
• 1% rule: 0.70%
• Cash to close: $35,840

Investor read

• This is a 2-bed/1.0-bath single-family listed at $128k.
• At list price, monthly cash flow is $-84 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $113k (11.6% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $90k (29.7% below list).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $90k (29.7% below list) — sets the bar for 1% rule.
• In year one you build about $3k of equity ($885 loan paydown + $2k appreciation (1.4% local appreciation)).
• Location reads 65/100 on livability (#452 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A-; Watch: employment C-, schools F, crime F.
• Burr Oak Community School District (rural): math 25% / reading 30% proficiency, ranked #569 of 760 in MI (top 75%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 63% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1924 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 8 active listings in the ZIP; 125 units permitted in St. Joseph County in 2024 (0 in 5+ unit buildings).
• St. Joseph County population projected at -16% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 4y 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 $50k; list at $128k implies a 156% gain — meaningful room to come down on a strong offer.

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 1924 — 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 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?
• 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.