2873 Ellison Ave

Omaha, NE 68111

$89,000B+

3 bd · 1.0 ba · 1,527 sqft · Built 1924 · Other · Active · 10 DOM

Cashflow @ list (25.0% down · 7.5%)

• Estimated rent: $1,609/mo
• Mortgage (P&I): −$467
• Tax + insurance: −$166
• HOA: −$0
• Vac / Maint / Mgmt: −$338
• Net cashflow: $639/mo
• Annual: $7,664/yr
• Cap rate: 14.90%
• Cash-on-cash: 30.75%
• DSCR: 2.37
• 1% rule: 1.81%
• Cash to close: $24,920

Investor read

• This is a 3-bed/1.0-bath other listed at $89k.
• At list price, monthly cash flow is $639 ($8k/yr) — positive.
• The deal already cash-flows at list — no discount required.
• Meets the 1% rule at list price ($2k rent vs $89k).
• Only 10 days on market — expect competitive offers; lowballing is unlikely to land.
• In year one you build about $10k of equity ($615 loan paydown + $9k appreciation (10.0% local appreciation)).
• Location reads 84/100 on livability (#7 in NE, #663 nationally) — a professional / high-income tenant draw. Strengths: amenities A+, commute A+, cost of living A+; Watch: crime F.
• Omaha Public Schools (urban): math 20% / reading 28% proficiency, ranked #110 of 111 in NE (top 99%) — low school quality limits family demand, transient renter base, plan for 1-2y turnover; 62% free/reduced lunch — lower-income household profile, screen leases tightly.
• Zoned schools: Miller Park Elementary School (math 17% / reading 17%, grade F, #471 of 502 statewide, top 95%, 390 students, 0% FRL); North High School (math 21% / reading 25%, grade F, #247 of 261 statewide, top 95%, 1,796 students, 0% FRL) — zoned schools average 0% FRL vs 62% district-wide (62 pts lower); this property's tenant base skews higher-income than the district average.
• Watch-outs: built in 1924 — expect roof / HVAC / electrical / plumbing capex.
• Market conditions: Rents rising (+3.2%/yr); 139 active listings in the ZIP; 17 comparable units currently listed for rent nearby; rentals at typical pace (median 22d on market — plan ~3-4 weeks tenant-placement turnaround); lower-income renter base — watch delinquency; 4,539 units permitted in Douglas County in 2024 (2,583 in 5+ unit buildings).
• Douglas County population projected at +28% by 2050 — long-run rental-demand tailwind backs the buy-and-hold thesis.
• At projected returns (10.0% appreciation + 3.2% rent growth), your $25k cash investment doubles in ~2 years — after that, you're playing with house money.
• By year 4, paydown + projected appreciation supports a ~$34k cash-out refi (75% LTV) — recoverable capital for the next deal without selling this one.
• Cap rate 14.9% vs local median 3.6% in Omaha — top-decile yield for the area; either an underpriced asset or a hidden risk that comps aren't pricing in. Stress-test before assuming the spread holds.
• At $1,609/mo this rent would consume 46% of the median local household income ($42k/yr) (locally 1913% of renters already pay >50% of income on rent) — very limited rent-growth headroom before tenants either downsize or default.

Questions for listing agent

• Built in 1924 — when were the roof, HVAC, electrical panel, plumbing, and water heater last replaced?
• Is there a deadline driving the sale (1031 exchange, divorce, estate, relocation)? That informs how much negotiation room exists.
• Crime grade is F in this area — have there been break-ins, vandalism, or insurance claims at this property in the last 3 years? What carrier currently insures it and at what premium?
• What's the average days-on-market for RENTAL listings here right now (not sales)? A rising rental-DOM trend means longer vacancies and softer asking-rent achievability than the comps imply.
• What's the recent tenant-quality profile in this submarket — average credit score on applications, eviction rate, late-payment / NSF rate, and stable-employment percentage? A property-management company in the area should have these aggregated.
• How much new for-sale + rental construction is in the pipeline within 1–3 miles? Heavy new supply typically softens prices + rents 12–24 months out; constrained supply supports both.