5 Santa Barbara Dr

El Cerro Mission, NM 87031

$311,400D

4 bd · 3.0 ba · 2,440 sqft · Built 1988 · Other · Active · 73 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,359/mo
• Mortgage (P&I): −$1,633
• Tax + insurance: −$282
• HOA: −$0
• Vac / Maint / Mgmt: −$495
• Net cashflow: $-52/mo
• Annual: $-622/yr
• Cap rate: 6.09%
• Cash-on-cash: -0.71%
• DSCR: 0.97
• 1% rule: 0.76%
• Cash to close: $87,192

Investor read

• This is a 4-bed/3.0-bath other listed at $311k.
• At list price, monthly cash flow is $-52 ($-622/yr) — negative.
• To cash-flow at today's rent, offer at most $302k (2.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $236k (24.3% below list).
• It's been on market 73 days — a 6% lower offer ($293k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $236k (24.3% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $9k of value loss. Plan a longer hold.
• Location reads 46/100 on livability (#330 in NM) — a working-class tenant base; expect higher turnover. Strengths: cost of living A+; Watch: schools F, crime F, amenities F.
• Los Lunas Public Schools (suburban): math 20% / reading 34% proficiency, ranked #34 of 95 in NM (top 36%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 63% free/reduced lunch — lower-income household profile, screen leases tightly.
• Market conditions: Rents rising fast (+33.2%/yr); 567 active listings in the ZIP; 303 units permitted in Valencia County in 2024 (0 in 5+ unit buildings).
• Valencia County population projected at -14% by 2050 — secular population decline; favor cash flow + early exit over multi-decade hold.
• 2 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: moderate wildfire risk; extreme-heat days projected 7→17/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.1% vs local median 4.8% in El Cerro Mission — meaningfully above typical; check what's discounted (condition, days-on-market, listing class) to confirm the premium yield is real.
• At $2,359/mo this rent would consume 46% of the median local household income ($61k/yr) (locally 602% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 73 days. Have you received any prior offers? Is the seller open to a 24% 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 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?
• 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.