Location: Lowell, MA | Metro: Lowell, 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 | $1,700 |
| 1 Bedroom | $1,870 |
| 2 Bedrooms | $2,440 |
| 3 Bedrooms | $2,950 |
| 4 Bedrooms | $3,210 |
| 5 Bedrooms | $3,724 |
| 6 Bedrooms | $4,171 |
| 7 Bedrooms | $4,505 |
| 8 Bedrooms | $4,730 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,440 | $386,602 | 0.63% | D |
| 3BR | $2,950 | $531,213 | 0.56% | F |
| 4BR | $3,210 | $566,958 | 0.57% | F |
| 5BR | $3,724 | $616,339 | 0.6% | D |
U.S. Census Bureau data (2024)
The economics of Section 8 housing in ZIP code 01851, which encompasses parts of Lowell, Massachusetts, in Middlesex County, can be analyzed based on specific financial metrics. The SAFMR (Small Area Fair Market Rent) for a two-bedroom apartment in this ZIP code for fiscal year 2024 is set at $1910. This SAFMR is the maximum amount that the federal government will pay landlords participating in the Housing Choice Voucher program for this specific ZIP code.
In contrast, the local market rent for a two-bedroom unit, as measured by ZORI (Zillow Observed Rent Index), is $2,261. This figure represents the average rent charged for similar units in the same area. For landlords considering whether to accept a Section 8 voucher tenant, it's crucial to understand how the voucher payment works.
A Section 8 voucher pays the difference between the SAFMR and the tenant's portion of the rent, which is typically 30% of their income. In ZIP 01851, if the tenant's portion is $573 (assuming a monthly income of $1910), then the government would cover the remaining $1337. However, landlords must also consider utility allowances when calculating the total reimbursement. Utility allowances vary but are generally around $300-$500 per month, depending on the number of bedrooms and the local cost of utilities.
To illustrate, let's assume a utility allowance of $400. The total reimbursement from the government would then be $1737 ($1337 for rent plus $400 for utilities). Given that the market rent is $2,261, this leaves a reimbursement gap of $524 per month. Landlords should factor this gap into their decision-making process, understanding that while they receive guaranteed payments from the government, they might earn less than the market rent.
In summary:
Landlords must weigh the benefits of stable, government-backed rental income against the potential loss from renting below market rates. The gap or surplus varies based on individual circumstances, but in ZIP 01851, landlords should expect a reimbursement that falls short of the local market rent by about $524 for a two-bedroom unit.
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.