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Thinking about investing in real estate in Omaha in 2025? You're on the right track.
Omaha's real estate market is showing promising signs, with steady growth and strong demand making it a solid investment choice.
In this blog post, we will explore why Omaha is a great place to invest in real estate right now.
We rely on reliable data and statistics from trusted sources to provide you with a clear picture of the market.
After a full analysis, we will share our own conclusions to help you make an informed decision. Enjoy the read!
This article gives you valuable insights, but remember, it’s not and will never be investment advice. We pull data from a range of sources to provide you with the most accurate picture possible, yet we can’t guarantee complete accuracy. Markets are difficult to predict. Make sure to do your own research and consult a professional before making any financial moves. Any risks or losses are your own responsibility.
Related analyses:
1) Omaha boasts an impressive livability score of 83, highlighting its excellent quality of life
Signal strength: strong
The livability score of 83 in Omaha is considered excellent, indicating a high quality of life for its residents.
One reason for this high score is Omaha's affordable cost of living, which is significantly lower than the national average, making it attractive for both residents and investors. Additionally, Omaha boasts a strong job market with a diverse range of industries, including finance, healthcare, and technology, providing stability and growth potential for property investments.
Another factor contributing to the livability score is the vibrant cultural scene, with numerous museums, theaters, and music venues that enhance the quality of life and attract new residents. These characteristics make Omaha a desirable place to live, which in turn supports the assumption that buying property here is a sound investment.
If the livability score were to drop below 70, indicating a decline in these positive attributes, it might suggest a less favorable investment environment.
Source: AreaVibes
2) Omaha's "vacancy rate" is just 6.0%, showing it's a bustling and competitive market
Signal strength: strong
The vacancy rate in Omaha is 6.0%, which is considered very low. This low vacancy rate indicates that the market is highly occupied and competitive, suggesting strong demand for rental properties.
When demand is high, it often means that property values are likely to appreciate over time, making it a potentially lucrative investment. In such markets, rental properties are easily rented, especially those that are well-maintained and located in desirable areas.
For instance, modern apartments in the Old Market district are particularly sought after due to their proximity to amenities and vibrant lifestyle. Investors can expect consistent rental income from such properties, given the strong demand.
If the vacancy rate were to rise above 10%, it might indicate a less favorable market for investment.
Sources: NeighborhoodScout, DataUSA, USCensus
3) Omaha boasts a strong employment rate of 67.7%
Signal strength: moderate
The employment rate in Omaha is at 67.7%, which is considered high compared to many other regions in the United States.
This high employment rate indicates a strong and stable economy, which is a positive sign for potential real estate investors. When more people are employed, they have the means to rent or buy properties, driving demand in the housing market.
Omaha's major employment sectors include finance, insurance, and healthcare, which are known for their stability and growth potential. Companies like Berkshire Hathaway and Union Pacific are significant employers in the area, contributing to the robust job market.
If the employment rate were to drop below 60%, it might indicate economic challenges that could affect the real estate market negatively.
4) Omaha's 2025 infrastructure plans, like the "Crossroads Development" and "Omaha Streetcar," are expected to significantly increase real estate values
Signal strength: moderate
Omaha's 2025 infrastructure projects, such as the Crossroads Development and Omaha Streetcar, are key drivers of real estate value in the area.
The Crossroads Development, a nearly $862 million project, is set to begin its first phase in the spring of 2025. This phase includes new parking garages and apartment buildings near Cass Street, with the city investing nearly $39 million using bonds paid off from TIF revenue. This development is expected to significantly boost property values in the surrounding areas, making it an attractive opportunity for real estate investors.
Meanwhile, the Omaha Streetcar Project, although not fully completed by 2025, will see significant utility work and construction, including the reconstruction of the Harney and Farnam Street bridges over I-480. This project is anticipated to enhance economic activity and increase property values in downtown Omaha, further supporting the notion that investing in real estate here could be lucrative.
These projects are expected to drive economic activity and attract businesses, thereby increasing demand for housing and commercial spaces. The anticipated rise in property values due to these developments suggests that buying property in Omaha could be a wise investment decision.
Sources: 3 News Now, Real Bricks, M.U.D. Omaha, RE Journals, 3 News Now
5) Omaha's metropolitan area is experiencing population growth
Signal strength: moderate
The population growth in Omaha's metropolitan area is a key indicator of potential investment success in the real estate market.
Despite a slight decline in the city's population, the metropolitan area has experienced consistent growth, with the population increasing from 835,000 in 2020 to 868,000 by 2024. This steady annual growth rate of approximately 0.93% to 1.06% suggests a rising demand for housing in the surrounding areas.
Projections indicate that the Omaha metropolitan area could soon reach one million residents, driven by factors such as employment opportunities and affordable living conditions. This anticipated growth is likely to increase property values, making real estate a potentially lucrative investment.
Omaha's economy is characterized by stability and growth, with strong sectors in financial services, healthcare, and manufacturing. The GDP growth in 2022 was approximately 3.2%, surpassing the national average of 2.1%. This economic strength further supports the attractiveness of investing in property in the area.
Sources: NCH Stats, Aterio Insights, Neilsberg Insights, Macrotrends
6) Airbnb or "short-term rental" in Omaha offers a decent profitability rate of 4.0%
Signal strength: moderate
The cash-on-cash return on Airbnb in Omaha is 4.0%, which indicates a moderate level of profitability for property investors. This percentage suggests that for every dollar you invest, you can expect a return of 4 cents annually from Airbnb rentals, which is a decent return compared to other investment options.
Omaha attracts a variety of short-term tenants, including business travelers attending conferences and events, as well as tourists visiting local attractions like the Henry Doorly Zoo. These visitors often prefer the comfort and convenience of Airbnb accommodations, which can lead to consistent demand for short-term rentals in the area.
Additionally, Omaha hosts several annual events and festivals that draw in tourists, further boosting the demand for Airbnb properties. This consistent influx of visitors helps maintain a steady occupancy rate, making it a reliable market for short-term rental investments.
If the cash-on-cash return were to drop below 2.0%, it might indicate a less attractive investment opportunity, as the returns would not justify the risks involved.
Source: Mashvisor
7) A 5.0% "cash-on-cash return" for long-term rentals in Omaha is reasonably appealing
Signal strength: moderate
The cash-on-cash return of 5.0% in Omaha indicates a moderate level of profitability for real estate investments.
This percentage suggests that investors can expect a reasonable return on their initial cash investment compared to other markets. In Omaha, the rental market is supported by long-term tenants such as students and young professionals who are often looking for affordable housing options.
These tenants provide a stable rental income, which is crucial for maintaining consistent cash flow over time. Additionally, Omaha's economy is bolstered by sectors like healthcare and education, attracting a steady influx of renters.
If the cash-on-cash return were to drop below 3.0%, it might indicate that the investment is less attractive.
Source: Mashvisor
8) Omaha's median home price is significantly lower, at 36% less than the "national average."
Signal strength: minimal
The fact that Omaha still has a median home price 36% below the national average suggests that there is room for growth in property values. This makes it an attractive market for investors looking to capitalize on potential appreciation.
In Omaha, the most expensive properties are likely to be luxury homes in areas like West Omaha, where amenities and larger lot sizes drive up prices. On the other hand, the cheapest properties are probably small, older homes in neighborhoods like North Omaha, where prices are more accessible for first-time buyers or investors.
Investing in Omaha real estate could be a smart move, especially if you focus on areas with potential for development and growth. This strategy can maximize your return on investment as the city continues to expand.
If the median home price in Omaha were to rise significantly above the national average, it might indicate that the market is becoming less favorable for new investments.
Source: Zillow
9) A local in Omaha could afford a house in about 3.9 years, which is reasonable
Signal strength: minimal
In Omaha, it would take around 3.9 years for a local to be able to buy a house, which is a positive indicator for potential real estate investors.
This figure is derived from the median household income of approximately $71,238 and the median home price of about $276,386. These numbers suggest that homes are relatively affordable compared to other markets, making it easier for locals to purchase property.
When locals can buy homes more easily, it often means there is a stable demand for housing, which is a good sign for investors. A stable demand can lead to consistent property value appreciation over time, enhancing the investment's potential return.
If the time required to buy a house were to increase significantly, say to over 6 years, it might indicate that homes are becoming less affordable, which could be a less favorable signal for investment.
Source: USCensus
So, is investing in real estate in Omaha a solid option in 2025? Absolutely, it is.
Investing in Omaha's real estate market in 2025 is a promising opportunity, thanks to several compelling factors.
First, Omaha's livability score of 83 highlights its excellent quality of life, driven by an affordable cost of living and a strong job market. These elements make it an attractive place for residents and investors alike. The city's vibrant cultural scene further enhances its appeal, ensuring a steady influx of new residents and supporting property demand.
Additionally, Omaha's low vacancy rate of 6.0% indicates a bustling and competitive market, suggesting strong demand for rental properties. This demand is likely to lead to property value appreciation, making it a potentially lucrative investment. The city's employment rate of 67.7% further underscores its economic stability, providing a solid foundation for real estate investments.
Moreover, Omaha's 2025 infrastructure projects, such as the Crossroads Development and Omaha Streetcar, are expected to significantly boost real estate values. These developments will drive economic activity and attract businesses, increasing demand for housing and commercial spaces. The city's population growth and affordable median home prices also contribute to its investment potential.
Finally, the cash-on-cash return of 5.0% in Omaha indicates a reasonable level of profitability for real estate investments. With a median home price 36% below the national average, there is ample room for growth in property values. All these factors combined make investing in Omaha's real estate market in 2025 a wise and promising decision.