1008 W Castillo Ave

Belen, NM 87002

$170,000D

2 bd · 1.0 ba · 908 sqft · Built 1950 · Other · Pending · 23 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,303/mo
• Mortgage (P&I): −$891
• Tax + insurance: −$177
• HOA: −$0
• Vac / Maint / Mgmt: −$274
• Net cashflow: $-39/mo
• Annual: $-467/yr
• Cap rate: 6.02%
• Cash-on-cash: -0.98%
• DSCR: 0.96
• 1% rule: 0.77%
• Cash to close: $47,600

Investor read

• This is a 2-bed/1.0-bath other listed at $170k.
• At list price, monthly cash flow is $-39 ($-467/yr) — negative.
• To cash-flow at today's rent, offer at most $163k (4.0% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $130k (23.3% below list).
• It's been on market 23 days — a 2% lower offer ($167k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $130k (23.3% 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 63/100 on livability (#72 in NM) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A, health & safety B; Watch: commute D, schools F, crime F.
• Belen Consolidated Schools (other): math 19% / reading 28% proficiency, ranked #50 of 95 in NM (top 53%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 83% free/reduced lunch — lower-income household profile, screen leases tightly.
• Watch-outs: built in 1950 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 426 active listings in the ZIP; 3 comparable units currently listed for rent nearby; rentals at typical pace (median 19d on market — plan ~3-4 weeks tenant-placement turnaround); 303 units permitted in Valencia County in 2024 (0 in 5+ unit buildings).
• Valencia County population projected at -14% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 4 sale attempts since 11y ago with the ask held roughly flat each time — persistent listings suggest the price (not the market) is what's stuck; bring a comps-based counter.
• Climate carrying-cost: moderate wildfire risk; extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.0% vs local median 3.5% in Belen — 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.
• This rent runs 30% of the median local income ($52k/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?
• Built in 1950 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.