Location: Springfield, MA | Metro: Springfield, MA MSA
Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,100 |
| 1 Bedroom | $1,250 |
| 2 Bedrooms | $1,570 |
| 3 Bedrooms | $1,920 |
| 4 Bedrooms | $2,070 |
| 5 Bedrooms | $2,401 |
| 6 Bedrooms | $2,689 |
| 7 Bedrooms | $2,904 |
| 8 Bedrooms | $3,049 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,570 | $301,829 | 0.52% | F |
| 3BR | $1,920 | $350,752 | 0.55% | F |
| 4BR | $2,070 | $438,257 | 0.47% | F |
U.S. Census Bureau data (2024)
A decision tree for whether to invest in ZIP 01071 (Russell, MA) for Section 8 properties starts with three key questions. The answers will guide you through the process of determining if this area is a good fit for your investment.
1) Does the Fair Market Rent (FMR) of $1170 cover the debt service on a property valued at $339,282?
If you can secure a property valued at $339,282, the FMR of $1170 must be sufficient to cover the debt service. Debt service typically includes mortgage payments, insurance, taxes, and maintenance. For a property of this value, assuming a 30-year fixed-rate mortgage at an average rate of around 6%, the principal and interest alone would amount to approximately $2,000 per month. This does not include other expenses such as property taxes, insurance, and maintenance costs. Therefore, the FMR of $1170 does not clear the debt service on a property of this value, leading to a no.
2) Is the market rent of $944 (from Census ACS) above, at, or below the FMR?
The market rent of $944 is below the FMR of $1170. This means that the rental market is less competitive compared to what the government considers fair, potentially giving Section 8 tenants a slight advantage in securing housing. However, this also indicates that the overall rental market may be weak, which could affect non-Section 8 rents. The answer is that market rent is below the FMR.
3) Are 11.2% renters plus the unknown days on market (DOM) indicative of enough demand?
The percentage of renters at 11.2% suggests a relatively low demand for rentals in ZIP 01071. Additionally, the lack of data on days on market (DOM) makes it difficult to assess how quickly properties are being rented out. Given these factors, there is insufficient evidence to conclude that the demand is strong enough to support a Section 8 investment. This leads to an it depends outcome, as other local factors might influence the decision.
In summary, while ZIP 01071 may seem appealing due to the higher FMR compared to market rent, the financials do not support a strong case for purchasing a $339,282 property for Section 8 tenancy. The low percentage of renters and lack of DOM data indicate a cautious approach is warranted. Further investigation into local conditions is recommended before making any investment decisions.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.