1305 Smith Ln

Farmington, NM 87401

$179,900D

3 bd · 2.0 ba · 1,680 sqft · Built 1990 · Other · Pending

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,598/mo
• Mortgage (P&I): −$943
• Tax + insurance: −$300
• HOA: −$0
• Vac / Maint / Mgmt: −$336
• Net cashflow: $19/mo
• Annual: $233/yr
• Cap rate: 6.42%
• Cash-on-cash: 0.46%
• DSCR: 1.02
• 1% rule: 0.89%
• Cash to close: $50,372

Investor read

• This is a 3-bed/2.0-bath other listed at $180k.
• At list price, monthly cash flow is $19 ($233/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $160k (11.2% below list).
• Only 0 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $160k (11.2% 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 66/100 on livability (#38 in NM) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: employment C-, crime F, commute F.
• Farmington Municipal Schools (urban): math 23% / reading 43% proficiency, ranked #23 of 95 in NM (top 24%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Animas Elementary (361 students, 100% FRL); Heights Middle School (718 students, 44% FRL); Piedra Vista High (math 27% / reading 52%, grade F, #68 of 110 statewide, top 62%, 1,578 students, 47% FRL) — zoned schools average 64% FRL vs 48% district-wide (16 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Market conditions: Rents rising fast (+5.1%/yr); 246 active listings in the ZIP; 2 comparable units currently listed for rent nearby; 78 units permitted in San Juan County in 2024 (8 in 5+ unit buildings).
• San Juan County population projected at -51% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 sale attempts since 4y 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.
• This rent runs 31% of the median local income ($62k/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 D-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.
• 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.