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 | $1,310 |
| 1 Bedroom | $1,390 |
| 2 Bedrooms | $1,730 |
| 3 Bedrooms | $2,120 |
| 4 Bedrooms | $2,410 |
| 5 Bedrooms | $2,796 |
| 6 Bedrooms | $3,132 |
| 7 Bedrooms | $3,383 |
| 8 Bedrooms | $3,552 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,730 | $345,810 | 0.5% | F |
| 3BR | $2,120 | $383,449 | 0.55% | F |
| 4BR | $2,410 | $413,314 | 0.58% | F |
| 5BR | $2,796 | $550,309 | 0.51% | F |
U.S. Census Bureau data (2024)
The analysis of the Section 8 program in ZIP code 02907, which covers parts of Providence, Rhode Island, reveals a significant gap between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR stands at $1610, while the market rent, as measured by the Zillow Observed Rent Index (ZORI), is $1891. This represents a gap of $281, or approximately 17.45%, between what the government deems fair and what landlords can expect to charge in the open market.
In the context of Providence, where 63.7% of residents are renters and the median home value is $392,374, landlords must consider the implications of this gap. The median income in the area is $52,485, indicating that many residents rely heavily on rental assistance programs such as Section 8 to afford housing. When the FMR is lower than the market rent, landlords who accept housing vouchers are essentially subsidizing the difference, which can be financially burdensome.
The cost of accepting Section 8 tenants below open-market rates is clear: landlords must forgo potential higher rents. However, this strategy can still be beneficial in terms of occupancy stability and long-term financial planning. Tenants with housing vouchers have a guaranteed source of payment, reducing the risk of vacancies and non-payment. In an environment where the majority of residents are already renting, this can provide a steady income stream that, while not as high as market rates, offers predictability and security.
To summarize, the gap between FMR and market rent in ZIP 02907 presents a challenge for landlords but also an opportunity to serve a large portion of the local population. Accepting Section 8 tenants means accepting a lower rent rate, but it also ensures a reliable tenant base in a city where renting is prevalent and incomes are relatively low.
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.