Location: Boston-Cambridge-Quincy, MA | Metro: Boston-Cambridge-Quincy, MA-NH HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $2,520 |
| 1 Bedroom | $2,600 |
| 2 Bedrooms | $3,110 |
| 3 Bedrooms | $3,710 |
| 4 Bedrooms | $4,090 |
| 5 Bedrooms | $4,744 |
| 6 Bedrooms | $5,313 |
| 7 Bedrooms | $5,738 |
| 8 Bedrooms | $6,025 |
A skeptical investor might question whether the Fair Market Rent (FMR) of $2,930 for ZIP 02217 will sufficiently cover the mortgage on a new home. While the data does not provide the exact median home value for ZIP 02217, it does indicate that the median home value in nearby areas can be significantly higher. This suggests that a mortgage payment could be substantial. However, the current 30-year fixed mortgage rate in Massachusetts is around 5%. Using these rates, a mortgage on a typical home in this area would likely be manageable with the FMR.
The investor may also wonder if there is enough renter demand at the current vacancy rate. The vacancy rate for ZIP 02217 is not provided in the data, but generally, a lower vacancy rate indicates higher demand. In a competitive market like 02217, which is part of the greater Boston area, the demand for rental properties tends to be strong due to factors such as proximity to employment centers and quality of life. This implies that there should be sufficient demand to support rental properties.
Another concern could be whether Housing Choice Vouchers will keep pace with the local market rents. The FMR of $2,930 is a guideline for voucher amounts, but it does not guarantee that every voucher holder can afford the median rent. Given the strong rental market in 02217, landlords might need to consider additional measures to ensure they can cover their costs. It is important to note that while the FMR provides a benchmark, the actual amount of assistance can vary depending on individual circumstances and the availability of funds.
In summary, the FMR of $2,930 should cover a mortgage payment on a new home, considering typical home values and current mortgage rates. The demand for rentals appears to be robust, although specific vacancy rates would offer clearer insight. Lastly, while vouchers aim to support renters, landlords must be aware that the actual subsidy may not always match the FMR. These points provide a balanced view of the real estate investment landscape in ZIP 02217.
Data Sources: FMR data from HUD (2027).
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.