5618 Makalu Dr

Colorado Springs, CO 80924

$585,000D-

5 bd · 3.0 ba · 3,024 sqft · Built 2021 · SingleFamily · Active · 69 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,223/mo
• Mortgage (P&I): −$3,068
• Tax + insurance: −$617
• HOA: −$0
• Vac / Maint / Mgmt: −$677
• Net cashflow: $-1,139/mo
• Annual: $-13,666/yr
• Cap rate: 3.96%
• Cash-on-cash: -8.34%
• DSCR: 0.63
• 1% rule: 0.55%
• Cash to close: $163,800

Investor read

• This is a 5-bed/3.0-bath single-family listed at $585k.
• At list price, monthly cash flow is $-1k ($-14k/yr) — negative.
• To cash-flow at today's rent, offer at most $384k (34.4% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $322k (44.9% below list).
• It's been on market 69 days — a 6% lower offer ($550k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $322k (44.9% below list) — sets the bar for 1% rule.
• Local home prices are declining (-1.8%/yr); year-one equity from $4k of loan paydown is wiped out by about $11k of value loss. Plan a longer hold.
• Location reads 78/100 on livability (#23 in CO, #2,639 nationally) — a middle-class / working-renter tenant base. Strengths: amenities A+, housing A+, health & safety A+; Watch: cost of living C-, crime F.
• Academy School District No. 20 In The County Of El Paso An (urban): math 45% / reading 65% proficiency, ranked #8 of 86 in CO (top 9%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 10% free/reduced lunch — higher-income household profile.
• Zoned schools: Chinook Trail Elementary School (math 62% / reading 82%, grade A-, #26 of 966 statewide, top 4%, 631 students, 8% FRL); Eagleview Middle School (math 42% / reading 59%, grade C, #38 of 270 statewide, top 14%, 948 students, 14% FRL); Pine Creek High School (math 53% / reading 77%, grade B, #31 of 381 statewide, top 8%, 1,815 students, 0% FRL) — zoned schools at 7% FRL track the district average.
• Market conditions: Rents soft (-0.8%/yr); 407 active listings in the ZIP; 6 comparable units currently listed for rent nearby; rentals at typical pace (median 17d on market — plan ~3-4 weeks tenant-placement turnaround); high-income renter base; 3,906 units permitted in El Paso County in 2024 (872 in 5+ unit buildings).
• El Paso County population projected at +28% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 6 sale attempts 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: major wildfire risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 4.0% vs local median 3.3% in Colorado Springs — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.

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 69 days. Have you received any prior offers? Is the seller open to a 45% concession, seller financing, or rate buy-down credit?
• 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 B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.