Location: Franklin County, MA | Metro: Franklin County, MA
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 | $1,360 |
| 1 Bedroom | $1,490 |
| 2 Bedrooms | $1,950 |
| 3 Bedrooms | $2,320 |
| 4 Bedrooms | $2,560 |
| 5 Bedrooms | $2,970 |
| 6 Bedrooms | $3,326 |
| 7 Bedrooms | $3,592 |
| 8 Bedrooms | $3,772 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,950 | $395,820 | 0.49% | F |
| 3BR | $2,320 | $465,239 | 0.5% | F |
| 4BR | $2,560 | $560,375 | 0.46% | F |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP 01373, South Deerfield, MA, reveals some key insights into potential investment opportunities. The Fair Market Rent (FMR) for a 2-bedroom unit in FY 2024 is set at $1390 per month, while the market rent based on Census ACS data stands at $1,224 monthly. To derive the gross yield, we annualize these figures against the median home value of $451,132.
Starting with the FMR scenario, an annualized rent of $16,680 ($1390 x 12) implies a gross yield of approximately 3.7%. This calculation is straightforward: divide the annual rent by the median home value. For the market rent scenario, an annualized rent of $14,688 ($1,224 x 12) translates to a gross yield of roughly 3.3%.
Given the 18.8% renter density in South Deerfield, it's important to consider the likelihood of finding tenants willing to pay the higher FMR rate. However, the data does not provide a specific Days on Market (DOM) figure, which would typically indicate how quickly properties are rented out. Without a definitive DOM figure, we can only rely on the available renter density percentage to make our assessment.
The higher gross yield of 3.7% under the FMR scenario suggests a potentially better return on investment compared to the 3.3% yield under market rent conditions. However, landlords should be cautious about relying solely on the FMR rate, as it may not reflect the actual rental market dynamics. The lower market rent yield of 3.3% is likely more reflective of the reality in South Deerfield, where the majority of residents might prefer to purchase rather than rent due to the relatively high renter density.
In conclusion, while the FMR scenario offers a slightly higher gross yield, the market rent scenario provides a more grounded perspective on what landlords can realistically expect. Investors should weigh these factors carefully, considering the local rental market trends and tenant availability when making investment decisions in ZIP 01373.
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.