Location: Aroostook County, ME | Metro: Aroostook County, ME
| Unit Size | Monthly FMR |
|---|---|
| Studio | $900 |
| 1 Bedroom | $900 |
| 2 Bedrooms | $1,180 |
| 3 Bedrooms | $1,590 |
| 4 Bedrooms | $1,650 |
| 5 Bedrooms | $1,914 |
| 6 Bedrooms | $2,144 |
| 7 Bedrooms | $2,316 |
| 8 Bedrooms | $2,432 |
U.S. Census Bureau data (2024)
The economics of Section 8 housing in ZIP code 04776, which is located in Tennessee, are structured around the SAFMR (Small Area Fair Market Rent) system. For a two-bedroom apartment in this ZIP code, the SAFMR for fiscal year 2026 is set at $1,220. This figure represents the maximum amount that the housing authority will pay landlords for rental units participating in the Section 8 program.
In contrast, the local market rent for a two-bedroom unit in ZIP 04776 is significantly lower at $672, according to recent Census ACS data. This discrepancy can be a point of concern for landlords, but it's important to understand the full picture when considering the benefits and costs of accepting Section 8 vouchers.
A Section 8 voucher is designed to cover the difference between the tenant’s portion of the rent and the total rent required by the landlord. The tenant is typically responsible for paying 30% of their adjusted income towards the rent. If we assume an average adjusted income of $1,500 for a tenant in this area, the tenant would contribute $450 towards the rent. The remaining balance, up to the SAFMR limit, would be covered by the housing authority.
To illustrate, if the landlord sets the rent at the SAFMR rate of $1,220, the housing authority would pay the difference between the tenant’s contribution and the total rent, which is $770. However, if the landlord sets the rent below the SAFMR, say at the market rate of $672, the housing authority would still only pay up to $1,220 minus the tenant’s contribution. Therefore, the landlord would receive the full $672 rent, with the housing authority covering the remaining $222, assuming the tenant contributes $450.
Beyond the base rent, landlords should also factor in utility allowances. These allowances vary but generally cover the cost of utilities such as electricity, water, and gas. For ZIP 04776, the utility allowance might add an additional $100-$200 to the monthly reimbursement, depending on the specifics of the voucher and the tenant’s utility usage.
In summary, for a two-bedroom unit priced at the market rate of $672, the landlord would receive the full $672 plus any applicable utility allowances. If the unit is priced at the SAFMR rate of $1,220, the landlord would receive the full $1,220. Given the local market conditions, landlords may find it advantageous to price their units closer to the market rate to avoid leaving money on the table.
The typical reimbursement gap or surplus for a two-bedroom unit in ZIP 04776, when priced at the market rate, is a surplus of approximately $548 per month, considering the SAFMR of $1,220 and the market rent of $672. This surplus can help offset any potential management costs associated with participating in the Section 8 program.
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.