Section 8 Fair Market Rent (FMR) for ZIP 01085 - 2027

Investment Score for ZIP 01085

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,250
1 Bedroom	$1,430
2 Bedrooms	$1,810
3 Bedrooms	$2,260
4 Bedrooms	$2,440
5 Bedrooms	$2,830
6 Bedrooms	$3,170
7 Bedrooms	$3,424
8 Bedrooms	$3,595

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,430	$275,957	0.52%	F
2BR	$1,810	$312,270	0.58%	F
3BR	$2,260	$388,427	0.58%	F
4BR	$2,440	$490,908	0.5%	F
5BR	$2,830	$526,416	0.54%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 01085 (Westfield, MA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 01085 is set by HUD for the year 2026. The FMRs are as follows: - 0BR: $1150 - 1BR: $1310 - 2BR: $1640 (which represents 22.2% of the median household income) - 3BR: $2010 - 4BR: $2170 These FMRs represent the maximum amount that a Section 8 voucher holder can pay for rent in different unit sizes. However, the actual rents in the area are significantly higher. For instance, the Zillow median price for a 2BR unit is $300,828, which translates into a monthly rental cost of approximately $1,500 based on typical mortgage calculations. This means that the actual rental costs are about 15.3 times the FMR for a 2BR unit. Consequently, voucher holders face significant constraints in finding affordable housing. They would likely struggle to find units that do not exceed their voucher limits, particularly for larger units like 3BR and 4BR. #### Affordability & Renter Profile ZIP code 01085 has a population of 41,102, with 30.8% being renters. The occupancy rate stands at 93.9%, indicating a relatively tight rental market. Given that the median household income is $88,728, it is clear that many residents can afford to live in the area without relying on government assistance. However, the 30.8% of renters who do require assistance are likely to find the market challenging due to the high price-to-FMR ratio. The fact that 2BR units are priced at 15.3 times the FMR suggests that there is a significant gap between what voucher holders can afford and the actual market rates. This tight market makes it difficult for low-income renters to find suitable housing, especially if they are looking for larger units. #### Investor Angle From an investor perspective, the ZIP code 01085 presents a mixed picture. While the actual rental prices are high, the FMRs set by HUD are much lower. A 2BR unit priced at $1,500 per month would be considered cash-flow positive if rented out at the FMR of $1,640. However, the challenge lies in attracting tenants who can afford these higher rents. If an investor focuses solely on Section 8 vouchers, they would need to ensure that their rental properties are priced at or below the FMR to attract voucher holders. Given the high actual rental prices, it might be difficult to achieve this, especially considering the tight market conditions. The investment grade for this ZIP code is moderate to high risk. The high price-to-FMR ratio indicates that there is a limited pool of potential tenants who can afford to live in the area using Section 8 vouchers. Investors should carefully consider the local demand for subsidized housing and the likelihood of finding tenants willing to pay the FMR. Additionally, the high occupancy rate suggests that there is little room for new rental units, which could impact the ability to fill vacancies quickly. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units such as 0BR and 1BR apartments. These units have FMRs of $1,150 and $1,310 respectively, which are more likely to align with the actual rental market. Smaller units are also more likely to be affordable for voucher holders, making them a better fit for Section 8-focused investments. 2. **Consider Location-Specific Amenities**: To attract tenants who can afford the higher rents, investors should consider adding amenities that increase the desirability of their properties. This could include features such as on-site laundry facilities, parking, or proximity to public transportation. By enhancing the value proposition of their properties, investors can potentially command higher rents while still remaining within the FMR guidelines. 3. **Develop Relationships with Local Housing Authorities**: Building relationships with local housing authorities can help investors secure a steady stream of Section 8 tenants. These authorities often have waiting lists and can facilitate the placement of voucher holders into available units. By working closely with these agencies, investors can mitigate the risk of vacancy and ensure a consistent cash flow. #### Bottom Line Based on the data provided, the recommendation for Section 8-focused investors is to **Skip** this ZIP code. The high price-to-FMR ratio and the tight rental market make it challenging to find tenants who can afford the FMRs. While there is a significant number of renters in the area, the majority of them are likely able to afford market rates without government assistance. Therefore, focusing on other ZIP codes with a lower price-to-FMR ratio and a more balanced rental market would be more advantageous for Section 8 investors.

Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.