Location: Eastern Worcester County, MA | Metro: Boston-Cambridge-Quincy, MA-NH 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 | $2,130 |
| 1 Bedroom | $2,230 |
| 2 Bedrooms | $2,920 |
| 3 Bedrooms | $4,000 |
| 4 Bedrooms | $4,370 |
| 5 Bedrooms | $5,069 |
| 6 Bedrooms | $5,677 |
| 7 Bedrooms | $6,131 |
| 8 Bedrooms | $6,438 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,920 | $462,783 | 0.63% | D |
| 3BR | $4,000 | $624,334 | 0.64% | D |
| 4BR | $4,370 | $817,816 | 0.53% | F |
| 5BR | $5,069 | $894,359 | 0.57% | F |
U.S. Census Bureau data (2024)
A skeptical investor looking into ZIP 01756 (Mendon, MA) might raise several concerns regarding the feasibility of investing in this area through the lens of Section 8 real estate. Here’s a detailed analysis addressing those concerns:
Objection 1: Will FMR $2380 (zip FY 2024) cover the mortgage on a $707,272 home?
The Fair Market Rent (FMR) for ZIP 01756 is set at $2380 for FY 2024. To understand if this covers the mortgage on a home priced at $707,272, we need to consider the mortgage rates and down payment. According to recent data, a 30-year fixed-rate mortgage with a 7% interest rate and a down payment covering 15% of the home’s price would result in a monthly mortgage payment of approximately $4,222. This includes principal, interest, PMI, property taxes, and homeowners insurance. Therefore, the FMR of $2380 would not be sufficient to cover the mortgage payment on a $707,272 home.
Objection 2: Is there enough renter demand at 13.1%?
The rental demand in ZIP 01756 is indicated by the rental rate, which stands at 13.1%. While this figure suggests a moderate level of demand, it does not provide a complete picture. The rental rate alone cannot determine the overall demand; other factors such as vacancy rates, population growth, and employment trends should be considered. The data provided does not give a comprehensive view of these aspects, so it’s difficult to conclusively state whether there is enough renter demand solely based on the 13.1% figure.
Objection 3: Will vouchers keep pace with $1,840 market rents?
The market rent for ZIP 01756 is reported to be around $1,840. However, the FMR set by HUD for Section 8 is $2380, which is higher than the market rent. This suggests that vouchers could potentially cover the market rent. Nonetheless, the actual amount received through vouchers can vary based on individual tenant circumstances and local housing authority policies. Therefore, while the FMR is higher than the market rent, it is crucial to verify with the local housing authority to ensure vouchers align with the current market conditions.
In conclusion, while ZIP 01756 presents certain challenges, particularly with the FMR not covering the mortgage on a $707,272 home, there are still opportunities for landlords and small-portfolio investors. It’s important to conduct thorough research and consult with local authorities to make informed decisions.
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.