Rental Rehabilitation Program

Financial assistance is available for rental owners to maintain and repair their properties within Sioux Falls city limits. The Rental Rehabilitation Program provides low-interest loans for needed materials during a renovation.

Property eligibility:

• Property must be registered or become registered as a rental property located within City limits.
• The program will not provide funding for the development of new rental units.
• Property must be structurally sound.
• Property owner must be current with the mortgage, property taxes, and insurance.
• Property owner must not have outstanding judgments, liens, or City violations or assessments.

Project eligibility:

• Completed application with supporting documents.
• Contractor estimates or owner material estimates must be submitted prior to loan signing.
• Any work done prior to application approval and physical inspection will be ineligible.
• Loans will be utilized for exterior and interior rehabilitation, excluding appliances.
  • Exterior work includes: Roof, doors/windows, porches, steps/stairs, gutters/downspouts, siding, paint, insulation, foundation, driveway/curb, sidewalk
  • Interior work includes: Mechanical, electrical, plumbing, paint, wall repair, floor coverings, cabinetry, insulation
• All PLUMBING, HVAC, and ELECTRICAL work requires a building permit and will be completed by contractors licensed with the City’s Planning and Development Services, and must pass all required city inspections.
• If the property owner completes the work themselves, loan funds will be provided for materials only.
• The loan must be signed within six months of application approval. Work must be completed within six months of loan signing. An extension can be requested and will be considered.

How does the program work?

1. Review the eligibility information on this page.

2. Collect supporting documents such as an estimate or bid for the work.
   Note: Any work completed before receiving a loan will not qualify for this program.

3. Apply online or visit City Center, 231 N. Dakota Ave., to apply in person.

4. A housing specialist will review your application. Once reviewed, you will be notified if you are eligible.

5. The loan will be funded to the applicant.

6. Renovation work can begin at the rental property.

Loan Terms

• Loans will be secured with a recorded mortgage.
• Up to $100,000 per project for buildings with 8 or fewer units and up to $200,000 per project for buildings with 9 or more units. Exterior work is divided evenly across the total units
  • Maximum of $25,000 per unit for projects with 8 or fewer units
  • Maximum of $20,000 per unit for projects with 9 or more units
• Minimum project total of $5,000
• Loan amounts may also be limited based on the availability of funding
• Total debt ratio on property (existing mortgage and proposed Rental Rehab loan) cannot exceed 100 percent of appraised/assessed value.
  • Interest rate varies by rent;
    • 3% for rents restricted to 65% Rent Limit
    • 1.5% for 50% Rent Limit
    • 0% for Fair Market Rent

* US Department of HUD - Fair Market Rents & Rent Limits for Sioux Falls MSA - Effective Date: June 1, 2026

• Interest rate amortized over

• 0% interest rate for the first six months.
• No loan origination fees.
• Payments will begin on the first day of the seventh month following the loan signing.
• Rent limits expire upon final loan payment (or a minimum of 2 years)
• Rents cannot be increased mid-lease
• There is no prepayment penalty.
• The loan is not assumable.

Loan disbursement:

• City will disburse payment directly to the owner after the contractor's invoice or the owner’s receipt of materials purchased is submitted, and a physical inspection occurs.
• Invoices for the down payment to order materials are eligible.
• When the final invoice is submitted, work must pass a final inspection by the City building inspector if a building permit was required.
• Building must be properly zoned (non-conforming properties are not eligible)