Location: Piscataquis County, ME | Metro: Piscataquis County, ME
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,010 |
| 1 Bedroom | $1,110 |
| 2 Bedrooms | $1,450 |
| 3 Bedrooms | $1,740 |
| 4 Bedrooms | $1,910 |
| 5 Bedrooms | $2,216 |
| 6 Bedrooms | $2,482 |
| 7 Bedrooms | $2,681 |
| 8 Bedrooms | $2,815 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 04463 in Rhode Island reveals some interesting insights. To begin, let's annualize the figures provided. The Fair Market Rent (FMR) for a 2-bedroom apartment in this area for FY 2026 is set at $1,520 per month. This translates to an annual rental income of $18,240 if rented under Section 8 guidelines. Conversely, the market rent for a similar property is $855 per month, which annualizes to $10,260.
Using these annualized rents, we can calculate the implied gross yields based on the median home value of $144,385. For the Section 8 scenario, the gross yield is calculated as follows:
For the market rent scenario, the calculation is:
The gross yield under Section 8 guidelines is significantly higher at 12.6%, compared to the market rent scenario, which yields only 7.1%. However, it is important to consider the broader context of the local real estate market. With a renter density of 27.8%, the demand for rental properties is moderate, suggesting that landlords might have to balance between market rates and Section 8 rents to attract tenants.
The Days on Market (DOM) data being N/A indicates there might be limited information on how quickly properties are typically leased in this area. Given the moderate renter density, it is likely that the market rent scenario is more realistic for most investors. While the higher gross yield under Section 8 is attractive, the lower renter density suggests that finding eligible tenants willing to pay the higher rate might be challenging.
In conclusion, while the potential for a higher gross yield exists under Section 8 guidelines, the actual performance may vary due to the local rental market dynamics. Investors should carefully evaluate the trade-offs between higher rental income and the ease of leasing properties at those rates.
Data Sources: FMR data from HUD (2027). 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.