Location: Omaha-Council Bluffs, NE | Metro: Omaha-Council Bluffs, NE-IA HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $890 |
| 1 Bedroom | $930 |
| 2 Bedrooms | $1,110 |
| 3 Bedrooms | $1,470 |
| 4 Bedrooms | $1,670 |
| 5 Bedrooms | $1,937 |
| 6 Bedrooms | $2,169 |
| 7 Bedrooms | $2,343 |
| 8 Bedrooms | $2,460 |
U.S. Census Bureau data (2024)
The analysis of the Section 8 cap-rate scenario for ZIP code 51554 reveals some key points that landlords and small-portfolio investors should consider.
The Fair Market Rent (FMR) for a 2-bedroom apartment in ZIP 51554 for FY 2024 is set at an annualized rate of $1040. This figure represents the maximum amount a landlord can charge for a Section 8 voucher tenant. However, it's important to note that the median home value in this area is not available, which complicates the direct calculation of a cap-rate based on property values. Similarly, the market rent for the area is also not available, making it difficult to compare the Section 8 rates directly to what might be charged in the open market.
In the absence of market rent data, we cannot calculate an exact gross yield for non-Section 8 properties. For Section 8 properties, assuming a median home value is not available, we must look at the renter density and days on market (DOM) to gauge the likelihood of finding tenants. The ZIP code has a reported renter density of 0.0%, indicating that very few residents are renters, and the DOM data is not available, suggesting challenges in accurately predicting how quickly a rental unit would be filled.
The implied gross-yield for a Section 8 property in ZIP 51554, based solely on the FMR, would be significantly lower than typical yields expected by investors. Given the low renter density, it is unlikely that landlords would be able to consistently fill units at the FMR rate, thus reducing the overall attractiveness of Section 8 properties in this area. The lack of market rent data means that we cannot provide a concrete comparison to non-Section 8 yields, but the sparse rental market suggests that non-Section 8 properties may offer better potential returns, despite the uncertainties in pricing.
In conclusion, while the Section 8 program offers a guaranteed rent of $1040 annually for a 2BR unit, the extremely low renter density and unavailability of DOM data make it challenging to achieve a steady income stream. Landlords and investors should carefully weigh these factors before considering Section 8 properties in ZIP 51554.
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.