Location: Omaha-Council Bluffs, NE | Metro: Omaha-Council Bluffs, NE-IA HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $970 |
| 1 Bedroom | $1,010 |
| 2 Bedrooms | $1,200 |
| 3 Bedrooms | $1,590 |
| 4 Bedrooms | $1,800 |
| 5 Bedrooms | $2,088 |
| 6 Bedrooms | $2,339 |
| 7 Bedrooms | $2,526 |
| 8 Bedrooms | $2,652 |
U.S. Census Bureau data (2024)
The analysis for ZIP code 51548 reveals a complex picture when it comes to Section 8 properties and their potential cap rates. To start, the Fair Market Rent (FMR) for a two-bedroom apartment in this area for fiscal year 2024 is set at $1110 per month. This figure annualizes to $13,320 per year. However, the median home value for the area is not available, which complicates the calculation of a precise gross yield.
In the absence of market rent data, we cannot directly compare the Section 8 rent to what landlords might typically charge. Nonetheless, we can still derive some insights into the potential gross yield based on the FMR alone. Assuming the median home value were available, say at a hypothetical $200,000, the implied gross yield using the FMR would be approximately 6.66%. This is calculated by dividing the annualized rent ($13,320) by the property value ($200,000).
The 6.5% renter density suggests that the demand for rental properties, including those participating in the Section 8 program, is relatively low compared to other areas. This could imply that landlords may find it challenging to fill vacancies with Section 8 tenants alone, especially if the local market rent significantly exceeds the FMR. The average number of days on the market (DOM) is also not available, which would have helped us understand how quickly properties are rented out in this area.
Given the limited data, the most realistic scenario for a gross yield would likely be closer to the FMR-based calculation rather than assuming higher market rents. Landlords should consider the lower demand for rentals and the specific terms of the Section 8 program when evaluating the potential returns on investment. While the exact cap rate cannot be determined without knowing the median home value and market rent, the gross yield derived from the FMR provides a conservative baseline for investment analysis.
Data Sources: FMR data from HUD (2027). Demographics from U.S. Census (2024).
About FMR: Fair Market Rent (FMR) is used to determine payment standards for the Section 8 Housing Choice Voucher program, initial renewal rents for some expiring project-based Section 8 contracts, and rent ceilings for HOME Investment Partnerships.