8074 Freda St

Detroit, MI 48204

$179,900D-

3 bd · 1.0 ba · 1,376 sqft · Built 1931 · SingleFamily · Active · 65 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,285/mo
• Mortgage (P&I): −$943
• Tax + insurance: −$170
• HOA: −$0
• Vac / Maint / Mgmt: −$270
• Net cashflow: $-98/mo
• Annual: $-1,180/yr
• Cap rate: 5.64%
• Cash-on-cash: -2.34%
• DSCR: 0.90
• 1% rule: 0.71%
• Cash to close: $50,372

Investor read

• This is a 3-bed/1.0-bath single-family listed at $180k.
• At list price, monthly cash flow is $-98 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $163k (9.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $129k (28.6% below list).
• It's been on market 65 days — a 6% lower offer ($169k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $129k (28.6% below list) — sets the bar for 1% rule.
• In year one you build about $19k of equity ($1k loan paydown + $18k appreciation (10.0% local appreciation)).
• 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: built in 1931 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 244 active listings in the ZIP; 19 comparable units currently listed for rent nearby; rentals lingering (median 44d on market — plan ~5-8 weeks vacancy on turnover, expect pricing pressure); 74% of comp listings sitting > 30 days — soft ceiling on asking rent; 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.
• 2 sale attempts; this cycle's ask has dropped $10k (5%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• Current owner paid $70k; list at $180k implies a 159% gain — meaningful room to come down on a strong offer.
• By year 2, paydown + projected appreciation supports a ~$31k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 5.6% 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.
• This rent runs 45% of the median local income ($34k/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?
• It's been on market 65 days. Have you received any prior offers? Is the seller open to a 29% concession, seller financing, or rate buy-down credit?
• Built in 1931 — 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?