943 Prospect Ave NE, Grand Rapids, MI 49503 — 32.4% Cash-on-Cash

About this property

943 Prospect Ave NE is a four-bedroom single-family property in Grand Rapids listed at $214,000, currently non-owner occupied and move-in ready.

The property sits on a 3,049-square-foot lot with 997 square feet of living area — compact, but the listing notes unfinished basement space that could expand usable square footage without a purchase-price premium. The kitchen has been updated with new cabinets and subway tile backsplash, and the flooring and paint are recent, which reduces near-term cosmetic capital expenditure for a new owner.

A three-season room and dedicated mudroom add functional space that doesn't count toward the official square footage but matters to tenants. The one-stall garage is accessible via alley, with additional off-street parking — a practical detail in a dense urban ZIP code. All appliances convey with the sale.

At 68 days on market with a $4,000 price reduction from the original ask, the property hasn't moved fast. The tax-assessed value sits at $149,400 against a $214,000 list price — a gap worth noting, though assessed values in Michigan often lag market. The property is flagged non-owner occupied, consistent with its investment framing, and carries no pre-foreclosure or auction status.

The investment case

Rent covering 1.8 times the monthly payment is the defining financial characteristic here — a margin that's uncommon in Grand Rapids, where the city average cash-on-cash return sits at negative 4.4%.

List Price

$214,000

Monthly Payment (PITI+HOA)

$1,495

Principal & Interest

$1,097

Property Tax

$327

Insurance

$71

HOA

$0

PMI

$0

Est. Monthly Rent

$2,650

Estimated rent: median of active rental listings in this zip with the same bed count and home type. See "Comparable rentals" below.

Cash-on-Cash Return

32.4%

Cap Rate

14.5%

Monthly Cash Flow

$1,155

Gross Rent Multiplier

6.7

DSCR

2.4

The numbers start with a $214,000 purchase price financed at the current 30-year fixed rate of 6.55%. Total monthly carrying costs — principal, interest, taxes at the 1.78% effective rate, and insurance — land at $1,495. Comparable rental analysis estimates $2,650 per month in achievable rent, producing $1,155 in monthly cash flow before vacancy and maintenance reserves.

That gap drives a 32.4% cash-on-cash return, compared to the city average of negative 4.4%. To put that spread in context: the weakest deal in Grand Rapids' top-10 leaderboard carries a 22.67% cash-on-cash return — meaning this property clears even that elevated bar by nearly 10 percentage points. It's not just outperforming the city average; it's outperforming the city's best deals.

The cap rate of 14.5% and a net operating income of $2,579 per month reflect a gross rent multiplier of 6.7 — low enough to suggest the purchase price is well below what the income stream would justify at typical capitalization rates. The debt service coverage ratio of 2.4 means the property generates 2.4 times what's needed to cover the mortgage, a cushion that absorbs vacancy or unexpected repairs without threatening debt service.

Figures exclude depreciation tax benefits, which vary by individual tax situation.

For a cash-flow investor, the core thesis here is straightforward: the income margin is wide enough to survive stress scenarios that would sink thinner deals.

Annual return outlook

The projected 41.1% total five-year ROI is driven primarily by cash flow, with appreciation and mortgage paydown as secondary contributors.

Cash flow contributes 32.4 percentage points of that 41.1% total — the dominant component by a wide margin. Mortgage paydown adds 4.6 points as principal reduces over five years. An estimated 4.2% annual appreciation rate contributes the remaining 4.2 points. That appreciation figure is an estimate, not a market-data scrape, so it carries more uncertainty than the income-side numbers.

The practical implication: this property's return thesis doesn't depend on price appreciation. If Grand Rapids appreciates at half the estimated rate, or not at all, the cash-flow and paydown components still produce a return well above what most local listings offer. That's a structurally different risk profile than appreciation-dependent plays, where the investment breaks even only if prices rise.

Over five years at current assumptions, the cash flow alone represents a meaningful return on the down payment. Appreciation is upside, not load-bearing.

How it compares to nearby for-sale listings

Five comparable four-bedroom listings in ZIP 49503 establish a market context that makes 943 Prospect Ave NE's $214,000 price look meaningfully below the peer group.

The for-sale comp median in this ZIP is $299,900 — $85,900 above this property's list price. At 997 square feet, 943 Prospect Ave NE prices out at roughly $215 per square foot. The nearest comp by square footage, 543 Leonard St NE at 1,124 square feet and $250,000, implies about $222 per square foot. Larger comps like 1534 Cedar St NE at 2,536 square feet and $299,900 come in closer to $118 per square foot, but those are different use cases.

What the comp table shows is that four-bedroom product in 49503 with two bathrooms commands $250,000 to $379,900. This property has one bathroom, which is the most obvious structural discount driver. A second bathroom addition could close part of that gap, though the cost-benefit depends on basement configuration and permitting.

At 68 days on market versus comps ranging from 29 to 44 days, this property has sat longer than its peers. The $4,000 price reduction suggests the seller has already adjusted once. For a buyer, that combination — below-median price, extended DOM, one price cut — typically signals negotiating room, though the seller has noted the right to implement an offer deadline.

Rental demand in this zip

Comparable rental analysis estimates $2,650 per month for this property, exactly matching the median across 10 four-bedroom rentals tracked in ZIP 49503.

10 comparable rentals in ZIP 49503 — median $2,650/mo, range $1,895–$3,200/mo

The rental comp pool of 10 properties in 49503 spans $1,895 to $3,200 per month, with a median of $2,650. This property's rent estimate lands at the median — not at the optimistic top of the range — which gives the cash-flow projection a reasonable basis. An investor underwriting at $2,650 isn't assuming best-case performance; they're assuming median market performance.

The $755 spread between the floor ($1,895) and the median ($2,650) is worth understanding. Properties at the low end of that range likely differ in condition, location within the ZIP, or amenity set. Given the recent kitchen updates, included appliances, garage, and proximity to downtown Grand Rapids and the Medical Mile as noted in the listing, a median-rent assumption appears defensible rather than aggressive.

Even stress-testing to 90% occupancy — one month vacant per year — the annual cash flow remains positive. At the comp floor of $1,895, the monthly cash flow would compress significantly, but the property would still cover its debt service given the 2.4 DSCR buffer built into the current projections.

The rent estimate is grounded in a 10-comp sample at the median, not the ceiling — a conservative starting point for underwriting.

Who this property suits + risks to weigh

This property fits a cash-flow-focused investor who wants income yield over speculative appreciation, with enough financial margin to absorb the risks a single-bathroom, nearly 1,000-square-foot property carries.

Best fit

An investor deploying capital at 20% down and prioritizing immediate income return over equity plays will find the 32.4% cash-on-cash return and $1,155 monthly cash flow hard to replicate elsewhere in Grand Rapids. The non-owner-occupied status means the property is likely already operating as a rental or has been recently, reducing the operational learning curve. The move-in-ready condition and included appliances lower the time-to-rent timeline.

A local investor who can self-manage or has a property management relationship in Grand Rapids is better positioned than an out-of-state buyer who'd absorb a management fee against the cash flow. At $2,650 in rent, a 10% management fee reduces monthly cash flow by $265 — still positive, but worth factoring into underwriting.

Risks to weigh

One bathroom in a four-bedroom property is the most consistent tenant friction point in this configuration. Families or groups of four adults sharing a single bath face practical limitations, which can narrow the tenant pool or increase turnover. The basement finishing opportunity is real but adds cost and complexity after purchase.

At 997 square feet across four bedrooms, the rooms are small. That constrains the tenant profile and could limit rent growth relative to larger four-bedroom product in the same ZIP. The 68-day DOM and prior price reduction suggest the market has already priced in some of these limitations — which is why the entry price is $85,900 below the comp median. The discount is the compensation for the constraints; investors should weigh whether that trade-off holds at their required return threshold.