Investment Summary:
In value-add turnarounds, even with a dream team like ours, there are times when the budget runs over. This project required $11,000 more in repairs than we initially projected — yet we still delivered an initial net ROI expectation of nearly 10%. This outcome highlights the margin of safety we build into every deal, allowing us to perform even when costs shift.
Property Overview
Address: 22477 S Kane St, Detroit, MI 48223
- Purchase Price: $50,000
- Estimated After Repair Value (ARV): $125,000
- CapEx (Capital Expenditure): $40,000
- Rent Potential: $1,200/month
- Square Footage: 914 sqft
- Year Built: 1952
- Lot Size: 46 x 118ft
- Property Taxes (2024): $1,141.64
- Zoning: R1 (Residential)
Neighborhood Analysis
- Location: Eliza Howell neighborhood
- A quiet brick street close to Schoolcraft/I-96 and Outer Drive, allowing easy access to the nearby suburbs
- Market Insights: The Zillow Home Values Index shows this area’s average property values to be about $90,000 in 2025, about 15% higher than the rest of Detroit, showing its desirability to the local residents
- The I-96 allows the residents to enjoy nearby suburban lifestyles, such as access to Costco in Livonia (7 mins) and Meijer on Grand River (8 mins). It is also 20 minutes’ drive from the Detroit Metro Airport on the Route 39.
Comparable Sales
- 22792 N KANE Street Detroit, MI 48223-2558, sold for $128,000, over its asking price
- 22501 KENDALL Street Detroit, MI 48223-2572, listed for $99,500 in 2025.
Final Takeaways
This property was purchased on January 2, 2025, with a projected all-in budget of $90,000 that ultimately totaled $101,000. Our target rent of $1,200 was adjusted slightly, with a tenant secured at $1,100 per month, resulting in a 9.86% ROI. This high ROI was supported by the property’s lower assessed valuation, likely a reflection of its proximity to the historically challenged Brightmoor neighborhood — which we view as an opportunity rather than a drawback.
The City of Detroit has significantly reduced crime rates in recent years. Right by this neighborhood, the Eliza Howell Park Master Plan is a city-led initiative to engage the local community, with budgets for road reconstruction and new nature trails, allowing residents to reclaim the city’s third-largest park.
Our team has been monitoring the early signs of gentrification in this area.
To us, the market data is clear; Zillow’s latest Home Values Index now places this zip code 15% higher than the rest of Detroit.
The City’s assessors may easily start catching up soon, but the property taxes on these early acquisitions will stay capped during our holding period. Our long-term SFR portfolio, supported by a veteran property management team with exceptional collection rates, allows us to take a diversified approach to property selection and valuation across the City when opportunities present themselves.