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 | $1,370 |
| 1 Bedroom | $1,520 |
| 2 Bedrooms | $1,990 |
| 3 Bedrooms | $2,380 |
| 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: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,990 | $426,224 | 0.47% | F |
| 3BR | $2,380 | $513,865 | 0.46% | F |
| 4BR | $3,330 | $576,637 | 0.58% | F |
U.S. Census Bureau data (2024)
ZIP 03906, located in North Berwick, ME, is best suited as an appreciation play within a Section 8 portfolio strategy. While the Federal Market Rent (FMR) for fiscal year 2024 is set at $1,480, the actual market rent stands at $1,105, indicating that the area is undervalued compared to government estimates. This discrepancy suggests potential for rental rates to rise closer to the FMR, thereby increasing cash flow over time.
The median home value of $482,833 is relatively high, but this does not necessarily impact the suitability of the area for Section 8 investments. The key consideration here is the relationship between FMR and market rent. Given that the market rent is below the FMR, there is room for growth as rental values adjust to meet the higher government standards. This upward pressure on rents can lead to increased profitability for landlords participating in the Section 8 program.
Although the data indicates a 11.1% renter share and a median income of $105,156, these factors do not significantly influence the decision to classify ZIP 03906 as an appreciation play. Instead, they highlight the area's potential as a diversifier, given the relatively high median income, which could attract a mix of tenants including those not reliant on Section 8 vouchers. However, the primary focus should remain on the potential for rental rate appreciation due to the disparity between FMR and market rent.
In conclusion, ZIP 03906 presents itself as an appreciation play within a Section 8 portfolio strategy. Landlords and small-portfolio investors should expect initial cash flows to be lower than the FMR, but with the potential for significant increases as market rents catch up to government estimates.
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.