Location: Boston-Cambridge-Quincy, 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 | $2,280 |
| 1 Bedroom | $2,350 |
| 2 Bedrooms | $2,810 |
| 3 Bedrooms | $3,350 |
| 4 Bedrooms | $3,690 |
| 5 Bedrooms | $4,280 |
| 6 Bedrooms | $4,794 |
| 7 Bedrooms | $5,178 |
| 8 Bedrooms | $5,437 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,810 | $571,469 | 0.49% | F |
| 3BR | $3,350 | $725,239 | 0.46% | F |
| 4BR | $3,690 | $993,357 | 0.37% | F |
| 5BR | $4,280 | $1,214,309 | 0.35% | F |
U.S. Census Bureau data (2024)
A skeptical investor might question whether the Fair Market Rent (FMR) of $2,400 for ZIP 02081 (Walpole, MA) in fiscal year 2024 will sufficiently cover the mortgage on a home valued at $765,570. To address this concern, it's important to note that the FMR represents the maximum amount that a household can pay for rent or homeownership costs under the Section 8 program. However, the actual mortgage payment depends on factors such as interest rates, loan terms, and down payments. According to typical financing scenarios, a monthly mortgage payment on a home priced at $765,570 could range widely depending on these variables. At current average interest rates, a mortgage payment might exceed the FMR, but this can be mitigated by offering the property for sale or through other rental programs that allow higher rent amounts.
The second objection raised by an investor could be the relatively low percentage of renters in Walpole, which stands at 17.1%. This figure suggests that the majority of residents prefer homeownership over renting. While this might seem concerning, it's worth noting that the presence of Section 8 housing can attract a specific segment of the population who rely on subsidized housing. Moreover, the local economy and job market play significant roles in sustaining rental demand. Investors should consider conducting further research into the employment trends and the number of households that qualify for the Section 8 program to gauge the potential demand accurately.
A final concern could be whether the Section 8 voucher payments will keep pace with the market rents, which are currently around $2,645. The FMR is designed to reflect the market conditions and is adjusted annually based on the cost of living and other economic factors. If the market rents continue to rise, the FMR is likely to increase accordingly. However, it's crucial to monitor the rate of increase in both market rents and FMR to ensure that the gap does not widen significantly. In some cases, landlords might need to supplement the voucher payments to cover the full rent, especially if they aim to compete with non-subsidized rentals.
In conclusion, while the data provides insights into the financial viability of Section 8 properties in ZIP 02081, it's essential to consider the broader context of the local real estate market and the specific terms of any potential financing. The relatively low renter population and the possibility of a growing gap between market rents and voucher payments present challenges, but also opportunities for those willing to navigate them carefully.
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.