12 Faust Ct

Ann Arbor, MI 48108

$289,900D

4 bd · 1.0 ba · 1,008 sqft · Built 1971 · SingleFamily · Active · 134 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,603/mo
• Mortgage (P&I): −$1,520
• Tax + insurance: −$338
• HOA: −$0
• Vac / Maint / Mgmt: −$547
• Net cashflow: $198/mo
• Annual: $2,375/yr
• Cap rate: 7.11%
• Cash-on-cash: 2.93%
• DSCR: 1.13
• 1% rule: 0.90%
• Cash to close: $81,172

Investor read

• This is a 4-bed/1.0-bath single-family listed at $290k.
• At list price, monthly cash flow is $198 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $260k (10.2% below list).
• It's been on market 134 days — a 12% lower offer ($255k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $255k (12.0% below list) — sets the bar for market timing.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $9k of value loss. Plan a longer hold.
• Location reads 88/100 on livability (#10 in MI, #155 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, employment A+; Watch: cost of living D.
• Ann Arbor Public Schools (urban): math 71% / reading 81% proficiency, ranked #6 of 540 in MI (top 1%) — strong family-tenant draw, lease renewals of 3-5y typical.
• Zoned schools: Ann Arbor Open At Mack School (math 74% / reading 84%, grade A, #21 of 1,397 statewide, top 2%, 517 students, 11% FRL); Tappan Middle School (math 67% / reading 82%, grade A, #15 of 493 statewide, top 3%, 680 students, 28% FRL); Pioneer High School (math 74% / reading 89%, grade A, #6 of 713 statewide, top 1%, 1,700 students, 23% FRL) — zoned schools at 21% FRL track the district average.
• Market conditions: Rents rising fast (+5.7%/yr); 148 active listings in the ZIP; 4 comparable units currently listed for rent nearby; rentals lingering (median 46d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 50% of comp listings sitting > 30 days — soft ceiling on asking rent; solid renter incomes; 996 units permitted in Washtenaw County in 2024 (492 in 5+ unit buildings).
• Washtenaw County population projected at +25% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts; this cycle's ask has dropped $30k (9%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $200k; 45% above their basis — modest negotiation headroom, anchor on the comps not their cost.
• Climate carrying-cost: major flood risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 7.1% vs local median 2.4% in Ann Arbor — 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.
• This rent runs 35% of the median local income ($89k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 134 days. Have you received any prior offers? Is the seller open to a 12% concession, seller financing, or rate buy-down credit?
• Built in 1971 — 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.
• 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?
• 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.