Location: Providence-Fall River, RI | Metro: Providence-Fall River, RI-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 | $1,630 |
| 1 Bedroom | $1,730 |
| 2 Bedrooms | $2,150 |
| 3 Bedrooms | $2,630 |
| 4 Bedrooms | $2,990 |
| 5 Bedrooms | $3,468 |
| 6 Bedrooms | $3,884 |
| 7 Bedrooms | $4,195 |
| 8 Bedrooms | $4,405 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,730 | $251,009 | 0.69% | D |
| 2BR | $2,150 | $373,718 | 0.58% | F |
| 3BR | $2,630 | $443,294 | 0.59% | F |
| 4BR | $2,990 | $614,705 | 0.49% | F |
| 5BR | $3,468 | $613,311 | 0.57% | F |
U.S. Census Bureau data (2024)
To determine if you should buy in ZIP code 02886 (Warwick, RI) for Section 8 investments, follow these steps:
Step 1: Debt Service Coverage Ratio (DSCR)
The Fair Market Rent (FMR) for ZIP 02886 in fiscal year 2024 is $2,030. For a property valued at $416,080, calculate your debt service coverage ratio (DSCR) using this figure. If $2,030 per month does not cover your total monthly expenses including mortgage payments, taxes, insurance, and maintenance, then the answer is No. Do not proceed further.
Step 2: Market Rent Comparison
If the FMR clears your debt service, compare it to the market rent of $1,390. If the market rent is below the FMR, then you can expect to charge higher rents under Section 8, making the investment Yes.
If the market rent is equal to or slightly above the FMR, the investment becomes It Depends. You will need to evaluate the local housing market dynamics and competition. Consider factors such as vacancy rates, tenant preferences, and the quality of the property.
Step 3: Rental Demand Analysis
If the FMR covers your debt service and the market rent is below or equal to the FMR, assess rental demand. In ZIP 02886, 35.4% of residents are renters, and the days on market (DOM) average is 18 days. This indicates a moderate rental demand. If you can find a property that meets the quality standards and has a strong location, the answer is Yes.
However, if you encounter a high number of properties listed for long periods or see signs of oversupply in the rental market, the answer shifts to No. High DOM values suggest difficulty in renting out properties quickly, which could lead to financial strain.
Summary
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.