Location: San Juan-Guaynabo, PR | Metro: San Juan-Guaynabo, PR HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $600 |
| 1 Bedroom | $610 |
| 2 Bedrooms | $710 |
| 3 Bedrooms | $930 |
| 4 Bedrooms | $1,120 |
| 5 Bedrooms | $1,299 |
| 6 Bedrooms | $1,455 |
| 7 Bedrooms | $1,571 |
| 8 Bedrooms | $1,650 |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 00983 in Connecticut provides a clear picture of the financial implications for landlords and small-portfolio investors. The Fair Market Rent (FMR) for a two-bedroom apartment in this area for fiscal year 2024 is set at $690 annually. Meanwhile, the market rent based on the Census ACS data stands at $637 per month.
To calculate the implied gross yield, we first need to annualize the market rent figure. Multiplying $637 by 12 months gives us an annual market rent of $7,644. Comparing this to the FMR of $690, the difference highlights the potential income disparity for landlords participating in the Section 8 program versus those who do not.
The median home value for ZIP 00983 is not available, which makes it challenging to provide a precise cap rate. However, we can still analyze the gross yield based on the provided rent figures. Assuming the average home value remains constant, the gross yield for a property rented under the Section 8 program would be lower than that of a market-rented property. For instance, if a landlord were to receive $690 per month from a Section 8 tenant, the annual income would be $8,280, leading to a higher gross yield when compared to the market rent scenario.
Given the renter density of 35.2%, it's important to consider how many properties are likely to be occupied by renters in general. This density suggests that while there is a significant portion of rental units, a majority of the housing stock is owner-occupied. Therefore, the market rent scenario may be more reflective of the overall rental landscape in ZIP 00983.
The Days on Market (DOM) data being unavailable also impacts the analysis. Typically, a higher DOM indicates slower rental turnover, which could affect the gross yield over time. However, without specific DOM figures, we cannot quantify this impact accurately.
In conclusion, the gross yield for a Section 8 property at $8,280 annually is slightly higher than the market rent scenario at $7,644 annually. Yet, considering the renter density and the lack of DOM data, the market rent scenario might offer a more realistic outlook for most landlords and small-portfolio investors in ZIP 00983.
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.