1104 S Joliet Ave Ave

Sioux Falls, SD 57110

$230,000D

3 bd · 3.0 ba · 1,512 sqft · Built 1978 · SingleFamily · Pending · 2 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,624/mo
• Mortgage (P&I): −$1,206
• Tax + insurance: −$231
• HOA: −$0
• Vac / Maint / Mgmt: −$341
• Net cashflow: $-154/mo
• Annual: $-1,851/yr
• Cap rate: 5.49%
• Cash-on-cash: -2.87%
• DSCR: 0.87
• 1% rule: 0.71%
• Cash to close: $64,400

Investor read

• This is a 3-bed/3.0-bath single-family listed at $230k.
• At list price, monthly cash flow is $-154 ($-2k/yr) — negative.
• To cash-flow at today's rent, offer at most $203k (11.8% below list).
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $162k (29.4% below list).
• Only 2 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $162k (29.4% 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 85/100 on livability (#3 in SD, #610 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: crime F.
• Sioux Falls School District 49-5 (urban): math 39% / reading 48% proficiency, ranked #45 of 59 in SD (top 76%) — families likely to look elsewhere, expect single-tenant / working-renter base with shorter leases.
• Zoned schools: Rosa Parks Elementary - 15 (math 30% / reading 32%, grade F, #200 of 253 statewide, top 79%, 729 students, 46% FRL); Washington High School - 01 (math 33% / reading 57%, grade D-, #110 of 151 statewide, top 73%, 1,910 students, 39% FRL).
• Market conditions: Rents rising (+3.5%/yr); 501 active listings in the ZIP; 22 comparable units currently listed for rent nearby; rentals at typical pace (median 23d on market — plan ~3-4 weeks tenant-placement turnaround); solid renter incomes; 2,425 units permitted in Minnehaha County in 2024 (1,367 in 5+ unit buildings).
• Minnehaha County population projected at +46% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• Cap rate 5.5% vs local median 2.6% in Sioux Falls — 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.

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?
• Built in 1978 — 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.
• Schools are B-rated — typically a magnet for longer-tenancy family renters. What's the average tenant stay here, and is there a school-zone premium baked into asking?
• 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.