20700 Damman St

Harper Woods, MI 48225

$229,900F

3 bd · 1.5 ba · 1,255 sqft · Built 1951 · SingleFamily · Active · 4 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,570/mo
• Mortgage (P&I): −$1,206
• Tax + insurance: −$333
• HOA: −$0
• Vac / Maint / Mgmt: −$330
• Net cashflow: $-298/mo
• Annual: $-3,577/yr
• Cap rate: 4.74%
• Cash-on-cash: -5.56%
• DSCR: 0.75
• 1% rule: 0.68%
• Cash to close: $64,372

Investor read

• This is a 3-bed/1.5-bath single-family listed at $230k.
• At list price, monthly cash flow is $-298 ($-4k/yr) — negative.
• To cash-flow at today's rent, offer at most $177k (22.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $157k (31.7% below list).
• Only 4 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $157k (31.7% 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 73/100 on livability (#199 in MI) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: employment D+, health & safety D+, crime F.
• Harper Woods School District (suburban): math 4% / reading 15% proficiency, ranked #524 of 540 in MI (top 97%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 69% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Beacon Elementary School (338 students, 84% FRL); Harper Woods Middle School (math 4% / reading 19%, grade F, #469 of 493 statewide, top 95%, 313 students, 82% FRL).
• Watch-outs: built in 1951 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+5.1%/yr); 135 active listings in the ZIP; 38 comparable units currently listed for rent nearby; rentals at typical pace (median 20d on market — plan ~3-4 weeks tenant-placement turnaround); 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.
• 4 sale attempts since 23y 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 $158k; 46% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Cap rate 4.7% vs local median 7.6% in Harper Woods — below-typical yield; the buyer is paying a premium for something (appreciation thesis, condition, location) that the cap rate doesn't capture.
• This rent runs 31% of the median local income ($62k/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?
• Built in 1951 — 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 D-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.