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 | $1,450 |
| 1 Bedroom | $1,530 |
| 2 Bedrooms | $1,910 |
| 3 Bedrooms | $2,340 |
| 4 Bedrooms | $2,660 |
| 5 Bedrooms | $3,086 |
| 6 Bedrooms | $3,456 |
| 7 Bedrooms | $3,732 |
| 8 Bedrooms | $3,919 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,530 | $182,458 | 0.84% | C |
| 2BR | $1,910 | $358,836 | 0.53% | F |
| 3BR | $2,340 | $438,419 | 0.53% | F |
| 4BR | $2,660 | $486,934 | 0.55% | F |
| 5BR | $3,086 | $557,402 | 0.55% | F |
U.S. Census Bureau data (2024)
The economics of Section 8 housing in ZIP code 02904, which encompasses parts of Providence, Rhode Island, within Providence County, are straightforward. The SAFMR (Small Area Fair Market Rent) for a two-bedroom apartment in this specific ZIP code is set at $1640 per month for fiscal year 2024. This figure is crucial because it directly influences the maximum amount that a Section 8 voucher will cover for a landlord.
In contrast, the local market rent for a similar two-bedroom unit, as measured by ZORI (Zillow Observed Rent Index), stands at $1,850 per month. This means that landlords might be able to charge a higher rent if they were renting outside of the Section 8 program. However, when dealing with Section 8 tenants, the rent is capped at the SAFMR rate.
Here's how the payment works. The tenant is responsible for paying a portion of the rent based on their income, typically around 30% to 40%. For instance, if a tenant’s income is $1,000 per month, their contribution would be approximately $300 to $400 towards the rent. Additionally, there are utility allowances that vary but generally do not exceed the rent cap. These allowances are meant to cover the cost of utilities such as electricity, gas, and water.
The Section 8 voucher then covers the difference between the tenant's contribution and the SAFMR rate. In our example, if the tenant contributes $350, the voucher would cover the remaining $1290 of the $1640 SAFMR rate. This ensures that the landlord receives the full SAFMR amount, even if the tenant cannot afford the entire rent.
However, since the local market rent is higher at $1,850, landlords may find themselves with a reimbursement gap. This gap is the difference between the SAFMR rate and the market rent, which in this case is $210 per month ($1,850 - $1,640). Landlords must decide whether to accept this lower rate or seek non-voucher tenants willing to pay the higher market rate.
To summarize, in ZIP 02904, a landlord can expect to receive a total of $1640 per month for a two-bedroom unit from a Section 8 voucher, regardless of the local market rent being $1,850. This leaves a reimbursement gap of $210, meaning landlords are effectively subsidizing the difference for Section 8 tenants.
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.