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Welcome Back,

Hi there, and welcome back to The Wealth Wagon. I hope you are having a fantastic Thanksgiving day so far. Today we will be diving into another Wisconsin market. I hope you enjoy!

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Real Estate Investing

Market Snapshot:

Milwaukee, Wisconsin
Milwaukee's real estate market is gaining attention for its affordability and rising rental demand. The median home price is $223,000, up 8.3% year-over-year, making it an attractive option for first-time investors. The city’s strong manufacturing and healthcare industries are fueling job growth, leading to increased demand for both single-family homes and multifamily properties. With active listings around 4,200 (up 3% from last year), buyers have slightly more options, but competition remains steady due to favorable price points.

Median Home Price: $223,000
YoY Price Growth: 8.3%
Active Listings: 4,200

Deal Of The Day:

Duplex in Murray Hill
Price: $570,000
Units: 2 (3-Bed, 4-Bath each)
Monthly Rental Income: $6,500
Cap Rate: 7.5%

This duplex in Milwaukee's trendy Murray Hill neighborhood offers strong cash flow and high rental demand due to its proximity to downtown and local amenities. Each unit rents for $3,250/month, with potential for further increases as rental rates in the area are growing at 6% annually. Ideal for investors looking for steady returns in a high-demand area.

Deal Rating: 8/10

I would put this particular deal at an 8/10 for a few reasons. Firstly it is a cash flowing property right away, it shows good potential for appreciation year over year based on it’s location. Although these are great the property has no significant area for improvement or value add.

Real Estate Tip:

Investment Strategy:

The "Subject To" Method
This strategy involves purchasing a property subject to the existing mortgage. The seller keeps the mortgage in their name, but the buyer takes over payments and gains ownership. This allows investors to avoid large upfront costs while acquiring property. Example: A $250,000 home with an existing 3% mortgage could save buyers thousands compared to current rates.

Current Interest Rates:

Milwaukee, Wisconsin
30-Year Fixed Residential: 7.1%
15-Year Fixed Residential: 6.5%
Commercial Rates: Starting at 6.6%

Milwaukee's rates are slightly above national averages, reflecting moderate demand for financing. Investors are leaning toward interest-only loans to maximize early cash flow, especially in multifamily deals.

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Economic Conditions

Milwaukee's economy is anchored by its manufacturing and brewing sectors, both of which are experiencing steady growth. The city’s unemployment rate stands at 4.3%, slightly above the national average, but job creation in healthcare and education is up 8% YoY. Rising inflation has increased construction costs by 4%, which could limit new builds but supports the value of existing properties.

Overall Market Rating: 7/10

This market shows extremely great growth potential for appreciation the high unemployment rate may cause issues down the line in necessary housing. This market does show great potential for not only cash flowing but also high appreciation investments.

Why Rust Belt Cities Are a Hidden Gem for Real Estate Investors

Rust Belt cities like Milwaukee, Cleveland, and Detroit are experiencing a resurgence as affordability draws new residents and businesses. Milwaukee, for instance, combines low housing costs with solid rental yields, making it a haven for investors. While these markets lack the glamour of coastal cities, they offer stability and long-term growth potential. Investors are finding 6-8% cap rates in many neighborhoods, outperforming pricier metros.

The key to success in these cities lies in targeting areas with strong economic anchors—universities, healthcare systems, and manufacturing hubs. For example, Milwaukee’s Menomonee Valley has undergone significant redevelopment, turning it into a hotspot for job growth and housing demand.

The Rust Belt’s lower entry costs also make it ideal for new investors. While a duplex in San Francisco might cost $1.5 million, a similar property in Milwaukee is available for under $500,000. With growing migration trends and rising rents, Rust Belt cities are no longer a secret among savvy real estate professionals.

Key Takeaways:

• Milwaukee Market Update: Median home price $223,000, with 8.3% YoY growth.

• Deal of the Day: $570,000 duplex generating $6,500/month in rental income.

• Tip: Multi-use properties can diversify income streams and boost ROI.

• Strategy: Use the Subject To method to acquire property with minimal upfront costs.

• Interest Rates: Residential rates at 7.1%, slightly above the national average.

• Economic Insight: Milwaukee's economy is growing, with job creation in healthcare and education.

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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