Location: Merrimack County, NH | Metro: Western Rockingham County, NH 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 | $1,520 |
| 1 Bedroom | $1,530 |
| 2 Bedrooms | $2,000 |
| 3 Bedrooms | $2,770 |
| 4 Bedrooms | $2,780 |
| 5 Bedrooms | $3,225 |
| 6 Bedrooms | $3,612 |
| 7 Bedrooms | $3,901 |
| 8 Bedrooms | $4,096 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,530 | $392,119 | 0.39% | F |
| 2BR | $2,000 | $469,334 | 0.43% | F |
| 3BR | $2,770 | $568,194 | 0.49% | F |
| 4BR | $2,780 | $662,875 | 0.42% | F |
U.S. Census Bureau data (2024)
The median income in ZIP 03261, Northwood, NH, stands at $129,375. This figure places the area in a relatively high-income bracket, which impacts the ability of residents to afford the market rate rental price of $1,201 per month. To put this into perspective, the median income suggests that the average household could indeed manage such an expense comfortably, given that it represents a significant portion of their monthly earnings.
However, when comparing the market rate to the Fair Market Rent (FMR) set at $1,610 for the fiscal year 2024, the discrepancy becomes apparent. The FMR is the amount that HUD determines as sufficient to cover the cost of decent housing in the area without placing an undue financial burden on families who must pay more than 30 percent of their adjusted income for rent. At $1,201, the market rate is below the FMR, indicating that landlords might be able to attract tenants through market-rate rentals. Yet, the higher FMR also implies that there is room for landlords to increase their rents while still being covered by government vouchers.
With only 11.0% of the population renting and a total population of 4,688, the competition among landlords is likely low. This means that landlords have the flexibility to choose between accepting Section 8 vouchers or focusing on cash-paying tenants. Given the affordability gap, where the FMR exceeds the market rate, landlords should consider the benefits of both approaches. Accepting vouchers can provide a steady stream of income, even if it requires some administrative effort. On the other hand, relying on cash-paying tenants allows for potentially higher rental rates, though it may limit the pool of potential renters.
The takeaway for landlords is that Northwood, NH, offers a unique opportunity. They can leverage the lower market rate to attract non-voucher tenants who can afford slightly higher rents, or they can accept vouchers to ensure consistent occupancy and income. Landlords should weigh the administrative costs of accepting vouchers against the potential for higher rents from cash-paying tenants to determine the most profitable strategy.
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.