Section 8 Fair Market Rent (FMR) for ZIP 02895 - 2027

Investment Score for ZIP 02895

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	$1,300
1 Bedroom	$1,380
2 Bedrooms	$1,720
3 Bedrooms	$2,110
4 Bedrooms	$2,390
5 Bedrooms	$2,772
6 Bedrooms	$3,105
7 Bedrooms	$3,353
8 Bedrooms	$3,521

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,380	$248,464	0.56%	F
2BR	$1,720	$338,079	0.51%	F
3BR	$2,110	$410,992	0.51%	F
4BR	$2,390	$428,559	0.56%	F
5BR	$2,772	$497,518	0.56%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 02895 (Woonsocket, RI) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 02895, as determined by HUD for 2026, is set at $1600 for a two-bedroom unit. This FMR represents 31.4% of the median household income of $61,059, indicating that it is a significant portion of what many residents can afford. However, the actual rental market price for a two-bedroom unit is significantly higher, with the Zillow median price being $326,807. This translates to a price-to-FMR ratio of 17.0x, meaning that the actual rent prices are much higher than the FMR. Given these figures, there are clear constraints for voucher holders. The FMR is designed to cover a reasonable rent amount for a two-bedroom unit, but the actual market prices far exceed this amount. For instance, a voucher holder might struggle to find a two-bedroom unit that costs only $1600 per month, as most units would cost closer to $326,807, which is well beyond the FMR. This makes it challenging for voucher holders to secure housing within their budget, especially in a market where prices are so high relative to the FMR. #### Affordability & Renter Profile ZIP code 02895 has a population of 43,521, with 62.8% of residents being renters. This indicates a strong rental market, where a majority of the population relies on renting rather than owning homes. The occupancy rate of 90.7% suggests that the housing stock is largely utilized, implying that there is little vacancy and potentially a tight rental market. The median household income of $61,059 provides context for the affordability of housing. With 31.4% of this income allocated towards a two-bedroom unit at FMR, it leaves very little disposable income for other necessities such as food, healthcare, and education. Given that the actual median rent price is 17.0x the FMR, it is evident that the market is extremely tight, and many residents, particularly those relying on Section 8 vouchers, may face significant challenges in finding affordable housing. #### Investor Angle From an investor perspective, the ZIP code 02895 presents both opportunities and challenges. The FMR for a two-bedroom unit is $1600, which is significantly lower than the actual market price of $326,807. However, the FMR is designed to ensure that housing is affordable for low-income families, and it is likely that landlords who accept Section 8 vouchers will be limited to charging no more than the FMR. To determine if this ZIP code is cash-flow positive at FMR, we need to consider the typical expenses associated with property management. Assuming a conservative estimate of 50% of the FMR going towards expenses (including mortgage payments, maintenance, insurance, and property taxes), the net cash flow would be approximately $800 per month for a two-bedroom unit. This is a relatively modest amount compared to the actual market rent, suggesting that properties rented at FMR levels may not generate substantial profit margins. The investment grade of this ZIP code is mixed. On one hand, the high demand for rental properties and the tight market suggest that there could be a steady stream of tenants. On the other hand, the strict limitations imposed by the FMR mean that investors cannot charge market rates, which could limit profitability. Additionally, the high price-to-FMR ratio indicates that the overall market is expensive, which could affect the initial investment costs and potential resale values. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units such as one-bedroom apartments, which have an FMR of $1300. These units are more likely to align with the actual rental market prices and provide better cash flow. For example, a one-bedroom unit priced at $1300 could still attract tenants who are willing to pay market rates, thus generating higher returns. 2. **Consider Mixed-Income Developments**: To mitigate the risk of low profitability due to FMR restrictions, investors might want to explore mixed-income developments. This involves creating a mix of units that cater to both Section 8 voucher holders and market-rate renters. By doing so, investors can leverage the higher market rates for some units while still providing affordable housing options for others. This approach can help balance the financial risks and rewards. 3. **Engage with Local Housing Authorities**: Investors should engage with local housing authorities to understand the nuances of the Section 8 program in Woonsocket. This includes knowing the number of available vouchers, the waiting list status, and any local policies that might affect the rental market. Building relationships with these authorities can also help in securing long-term tenancies and ensuring compliance with regulations. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 02895 is to **Skip**. While there is a strong rental market with high demand, the extremely high price-to-FMR ratio means that properties rented at FMR levels will not generate substantial profits. Additionally, the tight market conditions make it difficult to find properties that can be rented at FMR without facing significant competition from market-rate rentals. Investors looking for steady cash flow and reasonable returns should consider other ZIP codes with a more favorable price-to-FMR ratio and less stringent market conditions.

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.