Section 8 Fair Market Rent (FMR) for ZIP 01588 - 2027

FY 2027 Fair Market Rent Rates

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

Housing Authorities Serving ZIP 01588

• Worcester Housing Authority (Worcester, MA) - 3,739 Section 8 vouchers
• Milford Housing Authority (Milford, MA) - 567 Section 8 vouchers
• Leominster Housing Authority (Leominster, MA) - 404 Section 8 vouchers
• Fitchburg Housing Authority (Fitchburg, MA) - 227 Section 8 vouchers
• Shrewsbury Housing Authority (Shrewsbury, MA) - 177 Section 8 vouchers
• Oxford Housing Authority (Oxford, MA) - 153 Section 8 vouchers
• The Bridge of Central Massachusetts (Worcester, MA) - 133 Section 8 vouchers
• Southbridge Housing Authority (Southbridge, MA) - 128 Section 8 vouchers
• Gardner Housing Authority (Gardner, MA) - 108 Section 8 vouchers
• Warren Housing Authority (Warren, MA) - 69 Section 8 vouchers

To determine if you should buy in ZIP code 01588 (Northbridge, MA) for Section 8 investments, follow these steps:

Step 1: Can the Fair Market Rent (FMR) of $1500 cover the debt service on a property valued at $431,801?

• If yes: The FMR of $1500 is likely sufficient to clear debt service on a property valued at $431,801, assuming typical financing terms. This means the rental income generated from a Section 8 tenant would meet the mortgage obligations.
• If no: The FMR of $1500 may not be enough to cover the debt service on a property of that value. Landlords would need to consider lower-valued properties or assess whether they can manage the shortfall through other income streams or reduced expenses.

Step 2: How does the market rent of $1,198 compare to the FMR?

• If market rent is below FMR: At $1,198, the market rent is below the FMR of $1500. This indicates that Section 8 tenants might pay a higher rent than what is typically charged in the area, making it an attractive option for landlords who want to ensure their properties are rented at a rate that covers costs and provides a buffer against potential underpayment.
• If market rent is at or above FMR: This scenario is not applicable based on the provided data. However, if the market rent were to equal or exceed the FMR, it would suggest that landlords could potentially achieve better returns by renting to non-Section 8 tenants, though the availability and reliability of such tenants must also be considered.

Step 3: Is there enough demand with 36.1% of residents being renters and unknown days on the market (DOM)?

• If yes: With 36.1% of the population renting, there is a significant demand for rental housing in Northbridge, MA. The unknown DOM suggests either limited data or a rapidly changing market, but high rental rates indicate strong interest in finding housing. Given the market rent is below the FMR, Section 8 properties are likely to attract tenants quickly, ensuring consistent occupancy.
• If no: The demand is insufficient. A lower percentage of renters or a high DOM would indicate that the market is saturated, or there is a lack of interest in renting, which could make it difficult to find tenants for your property. However, since the DOM is not available, this cannot be definitively assessed. But the current rental rate being below FMR is a positive sign for Section 8 properties.
• If it depends: The answer hinges on the specific financing structure and local real estate market conditions. If the debt service is minimal or manageable with the FMR, and there is a steady flow of Section 8 applicants, then the 36.1% rental rate and the absence of DOM data do not necessarily preclude investment. However, landlords must also consider the operational challenges of managing Section 8 properties.

In summary, if the FMR of $1500 clears the debt service on a property valued at $431,801, and the market rent is below this FMR, then the ZIP code 01588 presents a viable opportunity for Section 8 investments. The 36.1% rental rate supports demand, though the lack of DOM data introduces some uncertainty. It ultimately depends on the landlord's risk tolerance and financial situation.

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.