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 | $1,520 |
| 1 Bedroom | $1,530 |
| 2 Bedrooms | $1,970 |
| 3 Bedrooms | $2,470 |
| 4 Bedrooms | $2,810 |
| 5 Bedrooms | $3,260 |
| 6 Bedrooms | $3,651 |
| 7 Bedrooms | $3,943 |
| 8 Bedrooms | $4,140 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,530 | $251,561 | 0.61% | D |
| 2BR | $1,970 | $344,612 | 0.57% | F |
| 3BR | $2,470 | $417,047 | 0.59% | F |
| 4BR | $2,810 | $445,667 | 0.63% | D |
| 5BR | $3,260 | $523,524 | 0.62% | D |
U.S. Census Bureau data (2024)
The economics of Section 8 housing in ZIP code 01603, which encompasses parts of Worcester, MA, and Worcester County, are driven by the Specific Area Fair Market Rent (SAFMR) set by the U.S. Department of Housing and Urban Development (HUD). For fiscal year 2024, the SAFMR for a two-bedroom apartment in this ZIP code is $1580. This figure represents the maximum amount that HUD will reimburse landlords for rent through the Section 8 Housing Choice Voucher program.
In contrast, the local market rent for a similar two-bedroom unit is $2,146, as indicated by the Zillow Observed Rent Index (ZORI). This difference highlights the financial dynamics landlords face when participating in the Section 8 program.
To understand the actual payment a landlord receives, it's important to break down the components of the voucher. The tenant is responsible for paying 30% of their adjusted income towards rent. If we assume an average adjusted income of $1,580 (the SAFMR), then the tenant would pay approximately $474 towards rent. However, the actual tenant contribution can vary based on individual income levels.
Beyond the base rent, there are utility allowances that must be considered. These allowances are designed to cover the cost of utilities such as electricity, gas, water, and sewer. The exact amount of these allowances varies but typically ranges from $200 to $300 per month. For simplicity, let's use an average allowance of $250.
Thus, the total reimbursement a landlord can expect from HUD for a two-bedroom apartment would be the sum of the tenant's portion and the utility allowance. In this case, it would be $474 (tenant portion) + $250 (utility allowance) = $724. Adding this to the base rent of $1580, the total reimbursement comes to $2304.
Given the local market rent of $2,146, a landlord participating in the Section 8 program in ZIP 01603 would see a slight surplus. The surplus is calculated as the difference between the total reimbursement ($2304) and the local market rent ($2146), resulting in a monthly surplus of $158.
This analysis provides a clear picture of the financial implications for landlords in Worcester, MA, who choose to participate in the Section 8 program. Despite the lower SAFMR compared to the local market rent, the inclusion of the tenant's portion and utility allowances ensures that landlords receive a reasonable reimbursement, often exceeding the market rent in this specific ZIP code.
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.