3 Palomino Dr

Durango, CO 81301

$134,500C+

3 bd · 2.0 ba · 976 sqft · Built 2000 · Manufactured · Active · 11 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,188/mo
• Mortgage (P&I): −$705
• Tax + insurance: −$224
• HOA: −$0
• Vac / Maint / Mgmt: −$459
• Net cashflow: $799/mo
• Annual: $9,585/yr
• Cap rate: 13.42%
• Cash-on-cash: 25.45%
• DSCR: 2.13
• 1% rule: 1.63%
• Cash to close: $37,660

Investor read

• This is a 3-bed/2.0-bath manufactured listed at $134k.
• At list price, monthly cash flow is $799 ($10k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $134k).
• Only 11 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $930 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 68/100 on livability (#106 in CO) — a middle-class / working-renter tenant base. Strengths: amenities A-, schools B+, employment B+; Watch: commute F, cost of living F.
• Durango School District No. 9-R (town): math 27% / reading 49% proficiency, ranked #30 of 86 in CO (top 35%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: Rents rising (+2.9%/yr); 580 active listings in the ZIP; solid renter incomes; 306 units permitted in La Plata County in 2024 (93 in 5+ unit buildings).
• La Plata County population projected at +25% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 4 sale attempts since 8y 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.
• Current owner paid $85k; list at $134k implies a 58% gain — meaningful room to come down on a strong offer.
• At projected returns (-3.0% appreciation + 2.9% rent growth), your $38k cash investment doubles in ~5 years — after that, you're playing with house money.
• Climate carrying-cost: major wildfire risk — expect insurance premiums to compound above CPI over the hold.
• Cap rate 13.4% vs local median 1.1% in Durango — 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 31% of the median local income ($84k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• 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?
• 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.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.