Omaha, Nebraska Home Affordability

The data below measures home affordability for the Omaha-Council Bluffs, Nebraska metropolitan area using price-to-income and price-to-rent metrics.¹ The maximum affordable loan amount for the median household income is also calculated. You can also compare Omaha home affordability to other cities.

Omaha, Nebraska Home Price-to-Income Ratios

The current price-to-income ratio for Omaha is 2.4 as determined by March 2012 Realtor median sales prices. The second chart shows a history of the ratio as an index calculated from the Federal Housing Finance Agency's Omaha HPI series. Median household income data for Omaha is from the Census American Community Survey.

Price-to-Income Dollar Ratio: Realtor

Price-to-Income Index Ratio: FHFA

Note: Index set to 100 in Q1 of 2000

Omaha, Nebraska Home Price-to-Income Ratio History

Date	Realtor (Dollar Ratio)	FHFA (Index Ratio)
March 2012	2.40	—
December 2011	2.46	104.8
September 2011	2.56	104.3
June 2011	2.57	102.9
March 2011	2.38	103.8
December 2010	2.54	104.9
September 2010	2.54	105.4
June 2010	2.54	104.6
March 2010	2.54	104.2

Omaha, Nebraska Home Price-to-Rent Ratios

The current adjusted price-to-rent ratio for Omaha is 14.14 as determined by March 2012 Realtor median sales prices. This ratio is calculated using household size adjusted median contract rent for Omaha. The chart below shows an index of the rent ratio calculated from the metro FHFA HPI series and the Omaha median contract rent data from the Census ACS.

Price-to-Rent Dollar Ratio: Realtor, Realtor Adjusted Rent

Price-to-Rent Index Ratio: FHFA

Note: Index set to 100 in Q1 of 2000

Omaha, Nebraska Home Price-to-Rent Ratio History

Date	Realtor (Dollar Ratio)	Realtor Adjusted (Dollar Ratio)	FHFA (Index Ratio)
March 2012	17.27	14.14	—
December 2011	17.72	14.52	96.3
September 2011	18.43	15.09	95.8
June 2011	18.52	15.17	94.6
March 2011	17.13	14.04	95.5
December 2010	18.31	15.00	96.4
September 2010	18.31	15.00	96.9
June 2010	18.31	15.00	96.1
March 2010	18.31	15.00	95.8

Omaha, Nebraska Home Rent-to-Mortgage Payment Ratio

The rent-to-mortgage payment ratio uses the adjusted rent for Omaha against a 100% loan-to-value mortgage (30-year fixed) for the median price home using Realtor home sales statistics. It's a lot like a cap rate, but I find it more appealing in ratio form. A ratio of 1.0 means that annual rent is equivalent annual mortgage payments. Values less than 1.0 indicate rents are cheaper and values greater than 1.0 mean mortgage payments are cheaper. Beware, taxes are not considered here. The rent-to-mortgage payment ratio for Omaha was 1.24 in March 2012.

Rent-to-Mortgage Payment Dollar Ratio: Realtor

Omaha, Nebraska Home Rent-to-Mortgage Payment Ratio History

Date	Realtor Adjusted Rent (Dollar Ratio)
March 2012	1.24
December 2011	1.21
September 2011	1.14
June 2011	1.08
March 2011	1.13
December 2010	1.07
September 2010	1.12
June 2010	1.07
March 2010	1.04

Omaha, Nebraska Inferred Affordable Mortgage

The inferred affordable mortgage value is determined by taking the median household income for Omaha, Nebraska and calculating the mortgage 30% of that income could afford. Traditionally, 30% of income is the maximum amount a homeowner could use towards a home loan. Inferred affordable loan values are calculated from ACS median household income and average monthly mortgage rates.

Inferred Affordable Mortgage

Omaha, Nebraska Inferred Affordable Mortgage History

Date	Inferred Mortgage
January 2012	$285,841
December 2011	$284,459
November 2011	$283,429
October 2011	$280,708
September 2011	$279,363
August 2011	$274,075
July 2011	$265,176
June 2011	$266,421
May 2011	$262,408
April 2011	$256,409
March 2011	$256,409
February 2011	$253,198
January 2011	$258,783