Location: York County, ME | Metro: York-Kittery-South Berwick, ME 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 | $1,550 |
| 1 Bedroom | $1,700 |
| 2 Bedrooms | $2,230 |
| 3 Bedrooms | $2,660 |
| 4 Bedrooms | $3,330 |
| 5 Bedrooms | $3,863 |
| 6 Bedrooms | $4,327 |
| 7 Bedrooms | $4,673 |
| 8 Bedrooms | $4,907 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,230 | $403,528 | 0.55% | F |
| 3BR | $2,660 | $494,831 | 0.54% | F |
| 4BR | $3,330 | $527,150 | 0.63% | D |
U.S. Census Bureau data (2024)
The Section 8 thesis for ZIP code 03901 in Berwick, ME, centers around the relationship between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR is set at $1,480, while the Census American Community Survey (ACS) indicates that the average market rent is $1,452. This creates a positive gap of $28, representing a 1.93% difference in favor of FMR.
In this scenario, where FMR exceeds the market rent, landlords and small-portfolio investors can leverage this discrepancy to increase their yields. The higher FMR means that voucher tenants can afford to pay slightly above the average market rate, thereby providing a financial advantage to property owners. This makes it particularly attractive for landlords to participate in the Section 8 program, as they can potentially earn more than what they would receive from non-voucher tenants.
Berwick's rental market is relatively modest, with only 12.6% of residents renting their homes. The median home value stands at $470,223, and the median household income is $94,771. These figures suggest a community that is predominantly owner-occupied and has a solid economic foundation, which supports the stability of the rental market.
The cost of housing voucher tenants below open-market rates is minimal in this case, given the slight premium offered by the FMR. Landlords can benefit from the guaranteed payments and the reduced risk of vacancy that comes with the Section 8 program. Additionally, the program ensures timely rent collection through direct payments from the government, further enhancing the attractiveness of the investment.
Investors should note that despite the favorable FMR, the overall rental demand in Berwick is low due to the high percentage of homeownership. However, the program's benefits can still outweigh these considerations, especially for those looking to stabilize their cash flows and secure a steady income stream.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.