147 Montrose St NE

Grand Rapids, MI 49505

$247,000D

3 bd · 1.0 ba · 1,397 sqft · Built 1925 · SingleFamily · Pending · 77 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,898/mo
• Mortgage (P&I): −$1,295
• Tax + insurance: −$292
• HOA: −$0
• Vac / Maint / Mgmt: −$398
• Net cashflow: $-88/mo
• Annual: $-1,055/yr
• Cap rate: 5.87%
• Cash-on-cash: -1.53%
• DSCR: 0.93
• 1% rule: 0.77%
• Cash to close: $69,160

Investor read

• This is a 3-bed/1.0-bath single-family listed at $247k.
• At list price, monthly cash flow is $-88 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $231k (6.3% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $190k (23.2% below list).
• It's been on market 77 days — a 6% lower offer ($232k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $190k (23.2% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 83/100 on livability (#44 in MI, #939 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: employment C-, crime F.
• Grand Rapids Public Schools (urban): math 15% / reading 29% proficiency, ranked #451 of 540 in MI (top 84%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 80% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1925 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+4.5%/yr); 147 active listings in the ZIP; 14 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 71% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• 18 sale attempts since 35y ago; this cycle's ask has dropped $28k (10%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $67k; list at $247k implies a 269% gain — meaningful room to come down on a strong offer.
• Climate carrying-cost: major flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.9% vs local median 4.5% in Grand Rapids — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.
• This rent runs 30% of the median local income ($75k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

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?
• It's been on market 77 days. Have you received any prior offers? Is the seller open to a 23% concession, seller financing, or rate buy-down credit?
• Built in 1925 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Why hasn't it sold? Are there any deal-killer items the seller is aware of (foundation, flood, title, zoning, code violations)?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• 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.