1207 E Pecos Dr

Hobbs, NM 88240

$190,000C-

3 bd · 2.0 ba · 1,528 sqft · Built 1956 · SingleFamily · Pending · 6 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,185/mo
• Mortgage (P&I): −$996
• Tax + insurance: −$248
• HOA: −$0
• Vac / Maint / Mgmt: −$459
• Net cashflow: $481/mo
• Annual: $5,773/yr
• Cap rate: 9.75%
• Cash-on-cash: 12.35%
• DSCR: 1.55
• 1% rule: 1.15%
• Cash to close: $53,200

Investor read

• This is a 3-bed/2.0-bath single-family listed at $190k.
• At list price, monthly cash flow is $481 ($6k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $190k).
• Only 6 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $6k of value loss. Plan a longer hold.
• Location reads 66/100 on livability (#37 in NM) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: employment D+, schools F, crime F.
• Hobbs Municipal Schools (town): math 17% / reading 31% proficiency, ranked #45 of 95 in NM (top 47%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover.
• Watch-outs: flood insurance adds $66/mo; built in 1956 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 235 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 172 units permitted in Lea County in 2024 (0 in 5+ unit buildings).
• Lea County population projected at +50% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 3 sale attempts since 9y 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.
• At projected returns (-3.0% appreciation + 3.0% rent growth), your $53k cash investment doubles in ~10 years — after that, you're playing with house money.
• Climate carrying-cost: major flood risk; severe wildfire risk; extreme-heat days projected 7→19/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• This rent runs 41% of the median local income ($63k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1956 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• What's the actual annual flood-insurance premium (NFIP or private), and is the property in a SFHA with mandatory coverage?
• 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?
• 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.