1203 Drake St

Socorro, NM 87801

$169,900D

4 bd · 2.0 ba · 1,296 sqft · Built 1974 · Other · Active · 260 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,234/mo
• Mortgage (P&I): −$891
• Tax + insurance: −$171
• HOA: −$0
• Vac / Maint / Mgmt: −$259
• Net cashflow: $-87/mo
• Annual: $-1,046/yr
• Cap rate: 5.68%
• Cash-on-cash: -2.20%
• DSCR: 0.90
• 1% rule: 0.73%
• Cash to close: $47,572

Investor read

• This is a 4-bed/2.0-bath other listed at $170k.
• At list price, monthly cash flow is $-87 ($-1k/yr) — negative.
• To cash-flow at today's rent, offer at most $155k (9.1% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $123k (27.4% below list).
• It's been on market 260 days — a 12% lower offer ($150k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $123k (27.4% 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 65/100 on livability (#59 in NM) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety B; Watch: employment D+, schools F, crime F.
• Socorro Consolidated Schools (town): math 12% / reading 21% proficiency, ranked #76 of 95 in NM (top 80%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Market conditions: 99 active listings in the ZIP.
• Socorro County population projected at -22% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts; this cycle's ask is 11% above the opening price — seller raised mid-cycle; expect resistance to lowballs.
• Climate carrying-cost: major flood risk; moderate wildfire risk; extreme-heat days projected 7→21/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 5.7% vs local median 2.8% in Socorro — 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 260 days. Have you received any prior offers? Is the seller open to a 27% concession, seller financing, or rate buy-down credit?
• Built in 1974 — 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?