Investment Summary:
We purchased this property with a good tenant with a 5-year history.
The renter agreed to a rent increase of $100 after closing. The acquisitions team flagged many updates as necessary for this property, but advised the managing partners that they could get them all done without removing the tenant, because much of it would be exterior work, such as siding and windows. There was some work in the kitchen area as well.
In fact, we ended up using half of the capital expenditure we earmarked because the tenant did not want the kitchen updates that were offered. The tenant still agreed to a rent of $1,000.00 starting August 1, 2025 after repairs were completed to her satisfaction.
Zillow has the property valued at above $60,000 in November 2025.
That would bring the equity growth close to 30%, which is an extraordinary outcome, based on the fact that we started cash-flowing from day one, with no downtime.
The simple return on capital for this property (pending property tax revisions) will start at a whopping 19%. Again, this may readjust as property taxes may rise after the change in ownership.
Property Overview
- Purchase Price: $15,000
- Estimated After Repair Value (ARV): $90,000
- Original CapEx (Capital Expenditure): $50,000
- Interim CapEx spent in 2025: $26,319
- Original Rent: $850/month
- Projected Rent: $950/month
- Final Rent: $1,000/month
- Square Footage: 733 sq ft
- Property Taxes (2024): $628.20
- Zoning: R1 (Residential)
Neighborhood Analysis
- Location: Greenfield neighborhood
- A fantastic location close to 8 Mile Road, that traditionally divides the Detroit properties from its suburban neighbors.
- Close to suburban amenities such as the Sam’s Club (7 mins), Home Depot (10 mins) and Best Buy (10 mins), and numerous restaurants alongside the 8 Mile Road.
- This is not a brick house like our typical favorite; however, we are making exceptions due to location and prospects.
- Market Insights: The Zillow Home Value Index shows the Greenfield neighborhood’s average home prices to be stable at around $70,000. The home is right by Southfield Road that leads to its suburban neighbors such as Oak Park and Southfield. The latter has many businesses, so this property sits in a very convenient location for the right renter.
Comparable Sales
- 19433 RUTHERFORD Street Detroit, MI 48235-2350, sold for $75,000 in January 2025.
- 19146 ASBURY Park Detroit, MI 48235-2401, sold for $115,000 in September 2024.
- 19766 Biltmore Street Detroit, MI 48235-2447 pending at $119,000 in November 2025.
The property has not gone through the updates that the second and the third comparable homes have had. There will always be the need to consider the differences in the work that was done internally. However, we feel strongly that this property can match the comparables comfortably depending on the construction budget and archieve capital gains.
Final Takeaways
The team will try to earmark a conservative level of capital expenditure, especially when we are purchasing a rented property. However, sometimes it makes sense not to utilize all that has been earmarked, as was the case with this property. The tenant may request a kitchen upgrade down the road, or we may only require it when the tenant leaves.
In either scenario, the team would like to create a comfortable margin for error to ascertain that we are proceeding cautiously and to achieve overwhelmingly positive outcomes.