306 E 7th St St

Dell Rapids, SD 57022

$169,900C-

3 bd · 2.0 ba · 762 sqft · Built 1936 · Other · Pending · 3 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,607/mo
• Mortgage (P&I): −$891
• Tax + insurance: −$178
• HOA: −$0
• Vac / Maint / Mgmt: −$338
• Net cashflow: $200/mo
• Annual: $2,406/yr
• Cap rate: 7.71%
• Cash-on-cash: 5.06%
• DSCR: 1.22
• 1% rule: 0.95%
• Cash to close: $47,572

Investor read

• This is a 3-bed/2.0-bath other listed at $170k.
• At list price, monthly cash flow is $200 ($2k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• To meet the 1% rule (rent ≥ 1% of price), the offer needs to be $161k (5.4% below list).
• Only 3 days on market — expect competitive offers; lowballing is unlikely to land.
• Recommended offer: $161k (5.4% below list) — sets the bar for 1% rule.
• Local home prices are declining (-3.0%/yr); year-one equity from $1k of loan paydown is wiped out by about $5k of value loss. Plan a longer hold.
• Location reads 83/100 on livability (#6 in SD, #1,043 nationally) — a professional / high-income tenant draw. Strengths: crime A+, employment A+, cost of living A+; Watch: amenities F, commute F.
• Dell Rapids School District 49-3 (town): math 61% / reading 64% proficiency, ranked #2 of 59 in SD (top 3%) — acceptable for families but not a draw, mixed tenant base, ~2y average lease; only 12% free/reduced lunch — higher-income household profile.
• Zoned schools: Dell Rapids Elementary - 02 (math 82% / reading 77%, grade A, #7 of 253 statewide, top 2%, 393 students, 12% FRL); Dell Rapids Middle School - 03 (math 55% / reading 60%, grade B, #27 of 143 statewide, top 18%, 299 students, 15% FRL); Dell Rapids High School - 01 (math 37% / reading 62%, grade D, #100 of 151 statewide, top 69%, 290 students, 12% FRL) — zoned schools at 13% FRL track the district average.
• Watch-outs: built in 1936 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: 76 active listings in the ZIP; 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.
• Current owner paid $53k; list at $170k implies a 221% gain — meaningful room to come down on a strong offer.

Questions for listing agent

• Built in 1936 — 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?
• 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.