502 W Animas St

Farmington, NM 87401

$179,000D-

3 bd · 2.0 ba · 968 sqft · Built 1953 · Other · Active · 21 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,315/mo
• Mortgage (P&I): −$939
• Tax + insurance: −$157
• HOA: −$0
• Vac / Maint / Mgmt: −$276
• Net cashflow: $-57/mo
• Annual: $-687/yr
• Cap rate: 5.91%
• Cash-on-cash: -1.37%
• DSCR: 0.94
• 1% rule: 0.73%
• Cash to close: $50,120

Investor read

• This is a 3-bed/2.0-bath other listed at $179k.
• At list price, monthly cash flow is $-57 ($-687/yr) — negative.
• To cash-flow at today's rent, offer at most $169k (5.7% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $131k (26.5% below list).
• It's been on market 21 days — a 2% lower offer ($176k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $131k (26.5% 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: Mccormick Elementary (411 students, 100% FRL); Tibbetts Middle School (683 students, 100% FRL); Farmington High (math 50% / reading 90%, grade B+, #18 of 110 statewide, top 17%, 1,824 students, 49% FRL) — zoned schools average 83% FRL vs 48% district-wide (35 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 70% at this address vs 33% district-wide (+37 pts) — the actual schools serving this property are materially stronger than the Farmington Municipal Schools average implies; a family-tenant draw the district grade alone would hide.
• Watch-outs: built in 1953 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+5.1%/yr); 238 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; this cycle's ask has dropped $16k (8%) from the opening price — seller is motivated, your offer sets the floor, not the list.

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 1953 — 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 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.