3825 Waverly St

Detroit, MI 48238

$159,900D

6 bd · 2.5 ba · 2,656 sqft · Built 1929 · Townhouse · Pending · 9 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,678/mo
• Mortgage (P&I): −$839
• Tax + insurance: −$553
• HOA: −$0
• Vac / Maint / Mgmt: −$352
• Net cashflow: $-66/mo
• Annual: $-797/yr
• Cap rate: 5.79%
• Cash-on-cash: -1.78%
• DSCR: 0.92
• 1% rule: 1.05%
• Cash to close: $44,772

Investor read

• This is a 6-bed/2.5-bath townhouse listed at $160k.
• At list price, monthly cash flow is $-66 ($-797/yr) — negative.
• To cash-flow at today's rent, offer at most $148k (7.3% below list).
• Meets the 1% rule at list price ($2k rent vs $160k).
• Only 9 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $148k (7.3% 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 $5k of value loss. Plan a longer hold.
• Location reads 73/100 on livability (#218 in MI) — a middle-class / working-renter tenant base. Strengths: amenities A+, commute A+, cost of living A+; Watch: schools F, crime F, employment F.
• Detroit Public Schools Community District (urban): math 10% / reading 24% proficiency, ranked #499 of 540 in MI (top 92%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 90% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: property tax is 3.7% of price; built in 1929 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+6.1%/yr); 346 active listings in the ZIP; 1 comparable units currently listed for rent nearby; lower-income renter base — watch delinquency; 2,639 units permitted in Wayne County in 2024 (1,216 in 5+ unit buildings).
• Wayne County population projected at -17% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 17 sale attempts since 10y ago; this cycle's ask is 14436% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Cap rate 5.8% vs local median 10.2% in Detroit — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.
• At $1,678/mo this rent would consume 60% of the median local household income ($33k/yr) (locally 2172% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 1929 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Property tax is high relative to price — has the assessment been appealed recently, and will the sale trigger a re-assessment?
• 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.