121 E College Ave

Rapid City, SD 57701

$140,000C+

3 bd · 1.0 ba · 1,174 sqft · Built 1951 · SingleFamily · Active · 4 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,480/mo
• Mortgage (P&I): −$734
• Tax + insurance: −$202
• HOA: −$0
• Vac / Maint / Mgmt: −$311
• Net cashflow: $232/mo
• Annual: $2,788/yr
• Cap rate: 8.28%
• Cash-on-cash: 7.11%
• DSCR: 1.32
• 1% rule: 1.06%
• Cash to close: $39,200

Investor read

• This is a 3-bed/1.0-bath single-family listed at $140k.
• At list price, monthly cash flow is $232 ($3k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($1k rent vs $140k).
• Only 4 days on market — expect competitive offers; lowballing is unlikely to land.
• Local home prices are declining (-3.0%/yr); year-one equity from $968 of loan paydown is wiped out by about $4k of value loss. Plan a longer hold.
• Location reads 74/100 on livability (#34 in SD, #4,720 nationally) — a middle-class / working-renter tenant base. Strengths: cost of living A+, housing A+, health & safety A+; Watch: crime F, commute F.
• Rapid City Area School District 51-4 (urban): math 34% / reading 46% proficiency, ranked #50 of 59 in SD (top 85%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: General Beadle Elementary - 01 (math 12% / reading 17%, grade F, #241 of 253 statewide, top 96%, 444 students, 100% FRL); North Middle School - 35 (math 15% / reading 24%, grade F, #135 of 143 statewide, top 96%, 513 students, 100% FRL); Central High School - 41 (math 35% / reading 61%, grade D, #106 of 151 statewide, top 71%, 1,768 students, 37% FRL) — zoned schools average 79% FRL vs 36% district-wide (43 pts higher); higher-poverty schools than district average — tighter screening recommended.
• Zoned-school proficiency averages 27% at this address vs 40% district-wide (-13 pts) — the specific schools serving this property underperform the Rapid City Area School District 51-4 average; the district grade overstates school quality for this exact location.
• Watch-outs: built in 1951 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+1.7%/yr); 217 active listings in the ZIP; 8 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); 1,181 units permitted in Pennington County in 2024 (715 in 5+ unit buildings).
• Pennington County population projected at +28% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 6 sale attempts since 12y 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.
• Current owner paid $83k; list at $140k implies a 69% gain — meaningful room to come down on a strong offer.
• Cap rate 8.3% vs local median 2.5% in Rapid City — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.
• This rent runs 31% of the median local income ($56k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• Built in 1951 — 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.
• 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.