409 6th St W

Lemmon, SD 57638

$89,900C+

3 bd · 1.0 ba · 784 sqft · Built 1948 · SingleFamily · Active · 94 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $940/mo
• Mortgage (P&I): −$471
• Tax + insurance: −$114
• HOA: −$0
• Vac / Maint / Mgmt: −$197
• Net cashflow: $157/mo
• Annual: $1,883/yr
• Cap rate: 8.39%
• Cash-on-cash: 7.48%
• DSCR: 1.33
• 1% rule: 1.05%
• Cash to close: $25,172

Investor read

• This is a 3-bed/1.0-bath single-family listed at $90k.
• At list price, monthly cash flow is $157 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($940 rent vs $90k).
• It's been on market 94 days — a 9% lower offer ($82k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $82k (9.0% below list) — sets the bar for market timing.
• In year one you build about $3k of equity ($622 loan paydown + $2k appreciation (2.2% local appreciation)).
• Location reads 79/100 on livability (#8 in SD, #2,009 nationally) — a middle-class / working-renter tenant base. Strengths: crime A+, cost of living A+, housing A+; Watch: schools C-, health & safety D+, amenities D.
• Lemmon School District 52-4 (rural): math 50% / reading 55% proficiency, ranked #60 of 148 in SD (top 40%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease.
• Watch-outs: built in 1948 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 20 active listings in the ZIP.
• Perkins County population projected at +15% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• 2 sale attempts since 2y ago; this cycle's ask has dropped $15k (14%) from the opening price — seller is motivated, your offer sets the floor, not the list.
• At projected returns (2.2% appreciation + 3.0% rent growth), your $25k cash investment doubles in ~5 years — after that, you're playing with house money.
• Climate carrying-cost: moderate wildfire risk — expect insurance premiums to compound above CPI over the hold.

Questions for listing agent

• It's been on market 94 days. Have you received any prior offers? Is the seller open to a 9% concession, seller financing, or rate buy-down credit?
• Built in 1948 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• 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.
• 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.