1006 North Ave

Carlsbad, NM 88220

$220,000D

3 bd · 2.0 ba · 1,037 sqft · Built 2010 · SingleFamily · Active · 35 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,701/mo
• Mortgage (P&I): −$1,154
• Tax + insurance: −$214
• HOA: −$0
• Vac / Maint / Mgmt: −$357
• Net cashflow: $-24/mo
• Annual: $-285/yr
• Cap rate: 6.16%
• Cash-on-cash: -0.46%
• DSCR: 0.98
• 1% rule: 0.77%
• Cash to close: $61,600

Investor read

• This is a 3-bed/2.0-bath single-family listed at $220k.
• At list price, monthly cash flow is $-24 ($-285/yr) — negative.
• To cash-flow at today's rent, offer at most $216k (1.9% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $170k (22.7% below list).
• It's been on market 35 days — a 3% lower offer ($213k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $170k (22.7% 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 $7k of value loss. Plan a longer hold.
• Location reads 70/100 on livability (#20 in NM) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, employment A; Watch: commute C-, health & safety C-, schools D.
• Market conditions: 363 active listings in the ZIP; 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 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.
• Climate carrying-cost: severe wildfire risk; extreme-heat days projected 7→20/yr by 2055 (HVAC capex compounding) — expect insurance premiums to compound above CPI over the hold.

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 35 days. Have you received any prior offers? Is the seller open to a 23% concession, seller financing, or rate buy-down credit?
• 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.