Section 8 Fair Market Rent (FMR) for ZIP 04401 - 2027

Investment Score for ZIP 04401

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,330
1 Bedroom	$1,400
2 Bedrooms	$1,750
3 Bedrooms	$2,240
4 Bedrooms	$2,540
5 Bedrooms	$2,946
6 Bedrooms	$3,300
7 Bedrooms	$3,564
8 Bedrooms	$3,742

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,400	$200,548	0.7%	D
2BR	$1,750	$241,647	0.72%	D
3BR	$2,240	$309,839	0.72%	D
4BR	$2,540	$363,469	0.7%	D
5BR	$2,946	$425,635	0.69%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 04401 (Bangor, ME) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for Bangor, ME (ZIP 04401) in 2026 is set at $1,680 for a two-bedroom unit. This represents 30.1% of the median household income in the area, which is $66,932. To understand how this compares to actual rents, we can look at the Zillow median price for a two-bedroom unit, which is $237,329. The price-to-FMR ratio for a two-bedroom unit is 11.8x, indicating that the actual market rent is significantly higher than the FMR. This creates a constraint for voucher holders, who may find it challenging to secure housing within the FMR limits. For instance, a voucher holder looking for a two-bedroom unit would be limited to paying $1,680 per month, whereas the market rent is likely much higher. This disparity could lead to a situation where voucher holders struggle to find suitable housing, particularly if landlords are unwilling to accept vouchers due to the lower rent they provide compared to market rates. #### Affordability & Renter Profile With a population of 44,854 and a renter percentage of 45.1%, Bangor has a substantial number of renters. Given the occupancy rate of 91.8%, it suggests that the rental market is relatively tight, with few vacancies available. The median household income of $66,932 means that many residents are middle-income earners, but the high rent-to-income ratio indicates that housing costs are a significant burden for many households. The FMR for a three-bedroom unit is $2,160, which is 32.3% of the median household income. This implies that families with children might find it particularly difficult to afford housing, especially if they rely on Section 8 vouchers. The high price-to-FMR ratio also indicates that the market is not very affordable for typical renters, making it a challenging environment for those seeking low-cost housing options. #### Investor Angle From an investor perspective, the ZIP code 04401 presents a mixed picture. While the occupancy rate is high, indicating strong demand, the price-to-FMR ratio of 11.8x suggests that the market rent is substantially above the FMR. This means that properties rented at FMR levels will likely generate negative cash flow unless there are significant subsidies or other financial incentives. To determine the investment grade, we need to consider the potential for positive cash flow and the risk associated with relying on Section 8 vouchers. Given the high market rent compared to FMR, the risk of vacancy is lower, but the cash flow will be negative without additional support. Therefore, the investment grade for this ZIP code is moderate to low for Section 8-focused investors. #### Specific Actionable Insights 1. **Focus on Larger Units**: Since the FMR for larger units (3BR and 4BR) is closer to the median income, investors might consider focusing on these types of units. A three-bedroom unit at $2,160 is 32.3% of the median income, which is still manageable for some households. Additionally, the demand for larger units is likely higher among families, providing a stable tenant base. 2. **Seek Additional Subsidies**: Given the high price-to-FMR ratio, investors should explore opportunities for additional subsidies or government programs that can help bridge the gap between market rent and FMR. This could include state-level assistance programs, tax credits, or other incentives that make the investment more financially viable. 3. **Consider Mixed-Income Developments**: Developing properties that cater to both market-rate tenants and Section 8 voucher holders could be a strategic approach. By having a mix of units, investors can balance the negative cash flow from Section 8 units with higher rents from market-rate units. This strategy can also help mitigate the risk of vacancy and ensure a steady stream of income. #### Bottom Line Given the high price-to-FMR ratio and the tight rental market, the recommendation for Section 8-focused investors is to **Skip** this ZIP code unless they have access to additional subsidies or can develop mixed-income properties. The negative cash flow at FMR levels makes it a less attractive option for purely Section 8 investments. However, for investors willing to diversify their tenant base and seek additional financial support, there might be opportunities to create a sustainable portfolio.

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.