Location: Worcester, MA | Metro: Worcester, MA HUD Metro FMR Area
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 | $1,430 |
| 1 Bedroom | $1,440 |
| 2 Bedrooms | $1,860 |
| 3 Bedrooms | $2,300 |
| 4 Bedrooms | $2,550 |
| 5 Bedrooms | $2,958 |
| 6 Bedrooms | $3,313 |
| 7 Bedrooms | $3,578 |
| 8 Bedrooms | $3,757 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,860 | $342,700 | 0.54% | F |
| 3BR | $2,300 | $432,819 | 0.53% | F |
| 4BR | $2,550 | $482,622 | 0.53% | F |
U.S. Census Bureau data (2024)
The Section 8 thesis in ZIP code 01506, which encompasses Brookfield, Massachusetts, is centered around the discrepancy between the Fair Market Rent (FMR) set at $1480 for fiscal year 2024 and the actual market rent reported at $1,014 according to the Census ACS. This represents a gap of $466, or approximately 46%, between the two figures.
Given that the FMR exceeds the market rent, landlords and small-portfolio investors can leverage this situation to maximize their rental yields. The higher FMR means that voucher tenants can potentially cover rents above the current market rate, making it a lucrative opportunity for property owners to increase their income without significantly raising the rent beyond what is supported by the voucher program.
In the context of Brookfield, where only 12.5% of residents are renters, and the median home value stands at $399,882, the median income of $81,250 suggests that many residents might be financially stable homeowners. However, the disparity between FMR and market rent indicates that there is a segment of the population benefiting from government assistance, allowing them to afford living in an area that would otherwise be out of reach based on the local median income.
The key advantage here is that voucher tenants can provide a steady and reliable source of income. Unlike the open market where rent fluctuates based on supply and demand, the Section 8 program guarantees a certain level of payment that aligns with the FMR. This stability can be particularly appealing for landlords in a market where rental demand is relatively low compared to owner-occupied homes.
However, it's important to note that accepting Section 8 tenants comes with its own set of challenges and considerations. While the financial benefits are clear, the administrative requirements and potential delays in rent payments must also be factored into the investment strategy. Additionally, the quality of maintenance and the necessity to comply with housing standards set by the program could influence long-term profitability.
In summary, the gap between FMR and market rent in ZIP 01506 presents a compelling yield play for landlords and small-portfolio investors. By accepting voucher tenants, they can achieve higher rental incomes than the open market allows, while also providing affordable housing options in a community where such assistance is needed.
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.