Section 8 Fair Market Rent (FMR) for ZIP 01902 - 2027

Investment Score for ZIP 01902

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$2,130
1 Bedroom	$2,230
2 Bedrooms	$2,650
3 Bedrooms	$3,180
4 Bedrooms	$3,510
5 Bedrooms	$4,072
6 Bedrooms	$4,561
7 Bedrooms	$4,926
8 Bedrooms	$5,172

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$2,230	$277,842	0.8%	C
2BR	$2,650	$417,127	0.64%	D
3BR	$3,180	$561,374	0.57%	F
4BR	$3,510	$614,213	0.57%	F
5BR	$4,072	$781,715	0.52%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 01902 (Lynn, MA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 01902 is set by HUD for the year 2026. For a two-bedroom unit, the FMR is $2,560. This amount represents 45.8% of the median household income of $67,046 in Lynn, MA. However, the actual rent for a two-bedroom unit, based on Zillow’s median price, is $420,505, which translates to a monthly rent of approximately $3,504 when considering a typical mortgage payment (assuming a 4.5% interest rate over 30 years). The price-to-FMR ratio is 13.7x, indicating that actual rents are significantly higher than the FMR. This discrepancy means that tenants using Section 8 vouchers face significant constraints. They can only afford units priced at or below the FMR, which is much lower than the actual market rates. Therefore, voucher holders would struggle to find suitable housing in the area without substantial subsidies or assistance beyond their vouchers. #### Affordability & Renter Profile ZIP code 01902 has a high renter population percentage of 63.1%, suggesting a strong demand for rental properties. The occupancy rate of 97.3% further supports this, indicating that the market is tight and there is little vacancy. Given the median household income of $67,046, many renters likely rely on financial assistance to cover their housing costs. The FMR for a three-bedroom unit is $3,080, which is still a significant portion of the median income. This suggests that families with children are particularly challenged in finding affordable housing. The high renter population and low vacancy rate indicate that the market is competitive, and landlords have considerable leverage in setting rent prices. #### Investor Angle From an investor perspective, the ZIP code 01902 presents both opportunities and challenges. The FMR for a two-bedroom unit is $2,560, but the actual market rent is around $3,504. This gap makes it difficult for investors to achieve positive cash flow if they are strictly adhering to FMR guidelines. However, the high demand for rental properties and the tight market conditions could potentially allow investors to charge rents closer to the actual market rate, especially if they target non-voucher tenants. For those who wish to participate in the Section 8 program, the investment would likely be less profitable due to the lower rent ceiling imposed by FMR. The investment grade for this ZIP code would be moderate to low for Section 8-focused investors, given the limited ability to generate cash flow at FMR levels. Investors looking for higher returns might consider targeting other segments of the rental market where rents can be set above FMR. #### Specific Actionable Insights 1. **Target Non-Voucher Tenants**: Given the high price-to-FMR ratio, investors should focus on attracting tenants who do not rely solely on Section 8 vouchers. This could involve marketing to families with higher incomes or offering amenities that justify higher rents. 2. **Consider Smaller Units**: One-bedroom units have an FMR of $2,160, which is closer to the median income proportionally. Investing in smaller units could provide better cash flow opportunities while still being accessible to some voucher holders. 3. **Explore Government Programs**: Investors might benefit from exploring other government programs that offer higher rent allowances or subsidies, such as the Low-Income Housing Tax Credit (LIHTC), which could help bridge the gap between FMR and market rents. #### Bottom Line For Section 8-focused investors, the ZIP code 01902 is a challenging market due to the high price-to-FMR ratio and limited cash flow potential. The recommendation would be to **skip** this ZIP code unless you can secure additional subsidies or are willing to accept lower returns. If you are interested in the broader rental market, the ZIP code offers potential, but it requires a strategy that goes beyond just relying on Section 8 vouchers.

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.