617 Forest St

Kalamazoo, MI 49008

$153,000C-

3 bd · 3.0 ba · 1,476 sqft · Built 1895 · SingleFamily · Active · 13 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,654/mo
• Mortgage (P&I): −$802
• Tax + insurance: −$265
• HOA: −$0
• Vac / Maint / Mgmt: −$347
• Net cashflow: $240/mo
• Annual: $2,880/yr
• Cap rate: 8.18%
• Cash-on-cash: 6.72%
• DSCR: 1.30
• 1% rule: 1.08%
• Cash to close: $42,840

Investor read

• This is a 3-bed/3.0-bath single-family listed at $153k.
• At list price, monthly cash flow is $240 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $153k).
• Only 13 days on market — expect competitive offers; lowballing is unlikely to land.
• 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 76/100 on livability (#141 in MI, #3,492 nationally) — a middle-class / working-renter tenant base. Strengths: commute A+, cost of living A+, housing A+; Watch: crime F, employment D-.
• Kalamazoo Public Schools (urban): math 43% / reading 72% proficiency, ranked #71 of 540 in MI (top 13%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; 66% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1895 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+2.4%/yr); 119 active listings in the ZIP; 15 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); 339 units permitted in Kalamazoo County in 2024 (22 in 5+ unit buildings).
• Kalamazoo County population projected at +18% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 22 sale attempts since 36y 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 $60k; list at $153k implies a 155% gain — meaningful room to come down on a strong offer.
• Cap rate 8.2% vs local median 4.2% in Kalamazoo — 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.

Questions for listing agent

• Built in 1895 — 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.
• 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?
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.