1502 S 21st St

Artesia, NM 88210

$240,000B-

3 bd · 2.0 ba · 1,498 sqft · Built 1986 · SingleFamily · Pending · 5 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $3,248/mo
• Mortgage (P&I): −$1,259
• Tax + insurance: −$187
• HOA: −$0
• Vac / Maint / Mgmt: −$682
• Net cashflow: $1,120/mo
• Annual: $13,435/yr
• Cap rate: 11.89%
• Cash-on-cash: 19.99%
• DSCR: 1.89
• 1% rule: 1.35%
• Cash to close: $67,200

Investor read

• This is a 3-bed/2.0-bath single-family listed at $240k.
• At list price, monthly cash flow is $1k ($13k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($3k rent vs $240k).
• Only 5 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $2k of loan paydown is wiped out by about $7k of value loss. Plan a longer hold.
• Location reads 63/100 on livability (#75 in NM) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+; Watch: employment C-, health & safety C-, schools F.
• Artesia Public Schools (town): math 29% / reading 42% proficiency, ranked #17 of 95 in NM (top 18%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Market conditions: 166 active listings in the ZIP; 3 comparable units currently listed for rent nearby; solid renter incomes; 156 units permitted in Eddy County in 2024 (0 in 5+ unit buildings).
• Eddy County population projected at +36% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 13y 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 $67k cash investment doubles in ~7 years — after that, you're playing with house money.
• Climate carrying-cost: major wildfire risk; extreme-heat days projected 5→13/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.
• At $3,248/mo this rent would consume 49% of the median local household income ($80k/yr) (locally 159% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

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 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.