Location: Washington County, ME | Metro: Washington County, ME
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 | $980 |
| 1 Bedroom | $1,030 |
| 2 Bedrooms | $1,350 |
| 3 Bedrooms | $1,870 |
| 4 Bedrooms | $2,080 |
| 5 Bedrooms | $2,413 |
| 6 Bedrooms | $2,703 |
| 7 Bedrooms | $2,919 |
| 8 Bedrooms | $3,065 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,350 | $245,418 | 0.55% | F |
| 3BR | $1,870 | $220,606 | 0.85% | C |
U.S. Census Bureau data (2024)
If a landlord is considering purchasing a property in ZIP code 04606 (Addison, ME) for Section 8 investment, the following decision tree will guide their decision based on the provided data points.
Step 1: Evaluate if the Fair Market Rent (FMR) of $1,490 can cover the debt service on a property valued at $200,216. This step is crucial because the FMR represents the maximum amount that a landlord can charge for rent under the Section 8 program. To determine if this clears debt service, you must calculate the monthly mortgage payment and other expenses associated with the property. Assuming a typical interest rate and down payment, the monthly mortgage payment might be around $800-$900. Adding property taxes, insurance, and maintenance costs could bring the total debt service to approximately $1,200-$1,300 per month. Therefore, the FMR of $1,490 would likely cover these expenses, leading to a Yes.
Step 2: Compare the Census ACS reported market rent of $900 against the FMR. The market rent is significantly lower than the FMR, indicating that the rental income potential from non-Section 8 tenants is below what you can charge under Section 8. This suggests that Section 8 properties could be more profitable relative to the market, leading to an It Depends. Landlords who prioritize guaranteed income and lower vacancy rates may find this favorable, while those seeking higher market rents might not.
Step 3: Assess the demand for rental properties. With 15.0% of residents being renters and the average days on market (DOM) being N/A, there is limited information about how quickly rental units are filled. However, the percentage of renters is relatively low, which could indicate a smaller pool of potential tenants. This leads to an It Depends. If the landlord is willing to accept a potentially slower turnover rate and has a strategy to attract Section 8 tenants, then the investment could still be viable.
Decision Tree Summary:
In conclusion, the decision to invest in ZIP 04606 for Section 8 properties hinges on the landlord's tolerance for lower market rents compared to FMR and their ability to effectively manage a property with potentially fewer rental applications. Given the data, the investment appears feasible but requires careful consideration of the local rental market dynamics and management strategies.
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.