36617 Herman St

Romulus, MI 48174

$160,000D

3 bd · 1.0 ba · 1,174 sqft · Built 1953 · SingleFamily · Active · 108 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,309/mo
• Mortgage (P&I): −$839
• Tax + insurance: −$199
• HOA: −$0
• Vac / Maint / Mgmt: −$275
• Net cashflow: $-4/mo
• Annual: $-51/yr
• Cap rate: 6.26%
• Cash-on-cash: -0.11%
• DSCR: 0.99
• 1% rule: 0.82%
• Cash to close: $44,800

Investor read

• This is a 3-bed/1.0-bath single-family listed at $160k.
• At list price, monthly cash flow is $-4 ($-51/yr) — negative.
• To cash-flow at today's rent, offer at most $159k (0.5% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $131k (18.2% below list).
• It's been on market 108 days — a 9% lower offer ($146k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $131k (18.2% below list) — sets the bar for 1% rule.
• 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 60/100 on livability (#593 in MI) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: commute D+, schools F, crime F.
• Romulus Community Schools (suburban): math 9% / reading 21% proficiency, ranked #498 of 540 in MI (top 92%) — 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.
• Watch-outs: built in 1953 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 215 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals leasing fast (median 5d on market — plan ~1-2 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.
• 6 sale attempts since 12y ago; this cycle's ask has dropped $40k (20%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $14k; list at $160k implies a 1085% gain — meaningful room to come down on a strong offer.
• Cap rate 6.3% vs local median 4.2% in Romulus — 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

• 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 108 days. Have you received any prior offers? Is the seller open to a 18% concession, seller financing, or rate buy-down credit?
• Built in 1953 — 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 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?