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 | $1,690 |
| 1 Bedroom | $1,700 |
| 2 Bedrooms | $2,190 |
| 3 Bedrooms | $2,740 |
| 4 Bedrooms | $3,130 |
| 5 Bedrooms | $3,631 |
| 6 Bedrooms | $4,067 |
| 7 Bedrooms | $4,392 |
| 8 Bedrooms | $4,612 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,700 | $279,233 | 0.61% | D |
| 2BR | $2,190 | $387,116 | 0.57% | F |
| 3BR | $2,740 | $453,006 | 0.6% | D |
| 4BR | $3,130 | $504,981 | 0.62% | D |
| 5BR | $3,631 | $548,790 | 0.66% | D |
U.S. Census Bureau data (2024)
ZIP 01606, located in Worcester, Massachusetts, is a strategic fit for a Section 8 portfolio due to its characteristics as a cash-flow anchor. The Fair Market Rent (FMR) for the HUD Metro FMR Area in Worcester, MA, for fiscal year 2024 is set at $1740. This figure represents the maximum rent that a Section 8 tenant can pay in this area. In comparison, the current market rent for ZIP 01606 stands at $2,229, indicating a significant gap between the two. This spread suggests that landlords can expect lower rental income from Section 8 tenants compared to market-rate tenants.
The median home value in ZIP 01606 is $436,778, which further emphasizes the importance of focusing on cash flow rather than appreciation. The price-cut share, which is a measure of how often homes are sold below their original asking price, is only 0.1%, suggesting that the housing market in this area is stable and does not offer substantial opportunities for capital appreciation through property flips. Additionally, the Days on Market (DOM), which measures how long properties typically stay on the market before being sold, is not applicable here, reinforcing the notion that appreciation plays are not a strong strategy in this ZIP code.
However, ZIP 01606 offers a solid diversification opportunity within a Section 8 portfolio. With a renter share of 32.2%, there is a significant portion of the population who rely on rental housing. Furthermore, the median income in the area is $92,105, providing assurance that there is a steady demand for affordable housing. Landlords can leverage this by ensuring they have a mix of properties that cater to different income levels, including those eligible for Section 8 assistance.
In summary, ZIP 01606 is best suited as a cash-flow anchor in a Section 8 portfolio strategy. The disparity between the FMR ($1740) and the market rent ($2,229) means that landlords should focus on maximizing their cash flow from Section 8 units rather than expecting rapid appreciation in property values. While it offers some diversification benefits, the primary strategic advantage lies in its reliability as a source of consistent, if somewhat lower, rental income.
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.