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Welcome back everyone! I hope you are doing fantastic this amazing Thursday. Today we will be discussing another real estate market on top of that we will dive into why investing in smaller cities may be worth it. Enjoy!

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Real Estate Investing

Market Snapshot:

Omaha, Nebraska Omaha’s real estate market is gaining attention for its affordability and rental demand. The median home price stands at $268,000, reflecting a 2.4% year-over-year increase. The city benefits from a strong local economy, driven by Fortune 500 companies like Berkshire Hathaway and Union Pacific Railroad. With a balanced inventory of 2,500 active listings, Omaha offers opportunities for both buyers and investors, particularly in the multifamily and single-family rental sectors. However, rising interest rates are cooling demand slightly, creating room for negotiation.

Median Home Price: $268,000
YoY Price Growth: 2.4%
Active Listings: 2,500

Deal Of The Day:

14-unit in Field Club Omaha

Price: $1,500,000
Units: 14 (12 2-Bed, 1-Bath, 2 1-Bed, 1-Bath )
Monthly Rental Income: $16,400
Cap Rate: 7.8%

Located near Downtown Omaha, this 14-unit is ideal for businessmen or young professionals. Units rents for an average of $1,150/month, providing strong cash flow with minimal vacancies due to the high demand for rentals in Midtown. The property also boasts recent renovations, including updated kitchens and bathrooms, reducing upfront maintenance costs for investors.

Deal Rating: 9/10

As you might have expected the determining factor for this being a great deal is the location being just 10 minutes from Downtown Omaha as well as the huge monthly rental income. The one main downside is the slower appreciation but with it’s proximity to Downtown Omaha it will still see good appreciation.

Real Estate Tip:

Investment Strategy:

Seller Financing for Entry-Level Investors
This strategy allows buyers to purchase properties with lower upfront costs by negotiating terms directly with the seller. For instance, a seller might agree to finance 70% of a $250,000 property at 5% interest, allowing the buyer to secure ownership without relying on traditional lenders. This can also be a win-win if the seller is looking for steady income rather than a lump sum payout.

Current Interest Rates:

30-Year Fixed Residential: 6.7%
15-Year Fixed Residential: 6.0%
Commercial Rates: Starting at 7.1%

Omaha’s rates align closely with national averages, making them manageable for buyers with strong credit. Commercial rates are slightly higher, reflecting tighter lending standards for multifamily properties. Investors should consider locking in rates before further increases.

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Why Small Cities Like Omaha Are Worth Watching

Investing in smaller cities often gets overlooked in favor of major metropolitan areas, but Omaha proves why this approach can be a game-changer. With a cost of living 7% below the national average, Omaha attracts a mix of young professionals and retirees, fueling demand for housing.

For investors, Omaha offers higher cap rates than coastal cities, averaging 7-8% for multifamily properties. Neighborhoods like Midtown and Dundee are seeing a surge in property values, thanks to urban revitalization projects and new restaurants, shops, and entertainment options.

The downside? Omaha doesn’t see rapid appreciation rates like San Francisco or Austin. Instead, investors gain steady cash flow and long-term stability. By focusing on rental income over speculative price jumps, Omaha investors can build sustainable portfolios. Small cities like Omaha are not just safer; they are a smart way to diversify investments in unpredictable markets.

Economic Conditions

Omaha’s unemployment rate sits at 3.4%, below the national average, thanks to its diverse economy spanning finance, healthcare, and transportation. Inflation is at 4.4%, leaving living costs to steadily rise. However, housing construction has slowed due to higher material costs, which could tighten inventory in the coming months and drive home prices upward.

Market Rating: 7.25/10

Although having little YoY appreciation this market would be great for huge cash flowing profits month after month seeing how a lot of properties cash flowing right of the bat. The low appreciation may cause issues down the line but those looking for purely monthly recurring income Omaha is a great choice.

Key Takeaways:

• Market Snapshot: Omaha’s median home price is $268,000, with a 2.4% increase YoY.

• Deal of the Day: A $1,500,000 fourplex in proximity to downtown, offers strong cash flow and a 7.8% cap rate.

• Tip: Understanding zoning laws can unlock new investment opportunities.

• Investment Strategy: Use seller financing to enter the market with lower upfront costs.

• Interest Rates: Residential rates in Omaha hover around 6.7%, with commercial rates at 7.1%.

• Economic Update: Omaha’s diverse economy supports a 3.4% unemployment rate, attracting a steady influx of renters.

That’s All For Today

I hope you enjoyed today’s issue. If you have any questions regarding today’s issue or future issues feel free to ask. Come back tomorrow for information on how to grow your income and wealth. I hope to see you.

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