This new tool from Freddie Mac is a great tool for seeing the potential on a national scale. Of course, Omaha is not one of the markets available to select but this is still a valuable tool.
(Freddie Mac Multifamily) This chart shows the AIMI value and the three variables that make up the AIMI going back to 2000. The value of AIMI is represented by the green bars in the chart. Hovering over the Index shows the value for each quarter. The orange line represents the property price growth and the yellow line displays the net operating income (NOI) growth. These two variables are indexed to the first quarter of 2000 and are represented on the left-hand-side axis. The mortgage rate is represented on the right hand side.
Overall, there is a decline in the index. The cost of property has exceeded the growth of operating income over time. The mortgage interest rates have raised ever so slightly, and the timing of this index was 4Q15. New projects are also facing new construction coming online from projects started 1-5 years ago.
The key to multifamily is as always: location, good management, property acquisition, and correct rent pricing.
If you are considering developing a multifamily project, contact Jerry Slusky for legal consultation.