3417 W Rapid St

Rapid City, SD 57702

$285,000D+

4 bd · 2.0 ba · 1,536 sqft · Built 1952 · MultiFamily · Active · 67 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $2,490/mo
• Mortgage (P&I): −$1,495
• Tax + insurance: −$343
• HOA: −$0
• Vac / Maint / Mgmt: −$523
• Net cashflow: $129/mo
• Annual: $1,551/yr
• Cap rate: 6.84%
• Cash-on-cash: 1.94%
• DSCR: 1.09
• 1% rule: 0.87%
• Cash to close: $79,800

Investor read

• This is a 4-bed/2.0-bath multifamily listed at $285k.
• At list price, monthly cash flow is $129 ($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 $249k (12.6% below list).
• It's been on market 67 days — a 6% lower offer ($268k) is reasonable based on typical stale-listing flexibility.
• Recommended offer: $249k (12.6% 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 $9k 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: South Canyon Elementary - 15 (math 37% / reading 42%, grade F, #169 of 253 statewide, top 71%, 266 students, 27% FRL); West Middle School - 37 (math 42% / reading 51%, grade D+, #73 of 143 statewide, top 51%, 612 students, 26% FRL); Stevens High School - 42 (math 56% / reading 86%, grade B+, #11 of 151 statewide, top 7%, 1,686 students, 14% FRL).
• Zoned-school proficiency averages 52% at this address vs 40% district-wide (+12 pts) — the actual schools serving this property are materially stronger than the Rapid City Area School District 51-4 average implies; a family-tenant draw the district grade alone would hide.
• Watch-outs: built in 1952 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising fast (+4.1%/yr); 236 active listings in the ZIP; 1 comparable units currently listed for rent nearby; solid renter incomes; 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.
• 4 sale attempts since 10y 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 — expect insurance premiums to compound above CPI over the hold.
• Cap rate 6.8% 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 33% of the median local income ($91k/yr) — at the standard rent-burdened threshold; future hikes will face affordability resistance.

Questions for listing agent

• It's been on market 67 days. Have you received any prior offers? Is the seller open to a 13% concession, seller financing, or rate buy-down credit?
• Built in 1952 — 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.
• 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.