Location: Washington County, VT | Metro: Washington County, VT
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 | $1,680 |
| 1 Bedroom | $1,840 |
| 2 Bedrooms | $2,410 |
| 3 Bedrooms | $3,010 |
| 4 Bedrooms | $3,170 |
| 5 Bedrooms | $3,677 |
| 6 Bedrooms | $4,118 |
| 7 Bedrooms | $4,447 |
| 8 Bedrooms | $4,669 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,840 | $208,018 | 0.88% | C |
| 2BR | $2,410 | $403,952 | 0.6% | F |
| 3BR | $3,010 | $600,810 | 0.5% | F |
| 4BR | $3,170 | $756,399 | 0.42% | F |
| 5BR | $3,677 | $1,025,633 | 0.36% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 05674 in Warren, Vermont, provides insight into the potential returns for landlords and small-portfolio investors. Using the Fair Market Rent (FMR) for a two-bedroom unit set at $1,840 annually for fiscal year 2026, and the market rent of $1,750 annually based on Census ACS data, we can derive the implied gross yields.
First, let's calculate the gross yield using the FMR. With an annual rent of $1,840 and a median home value of $483,068, the implied gross yield is approximately 0.38%. This is calculated by dividing the annual rent ($1,840) by the median home value ($483,068).
Next, we'll compute the gross yield using the market rent. The annual market rent of $1,750 against the median home value of $483,068 results in an implied gross yield of about 0.36%. Again, this figure is derived by dividing the annual market rent ($1,750) by the median home value ($483,068).
The difference between these two gross yields is minimal, with the FMR scenario offering a slightly higher yield at 0.38% compared to the market rent scenario at 0.36%. However, when considering the 13.3% renter density in Warren, it becomes evident that the market rent scenario is more realistic. The low renter density suggests a limited pool of tenants, making it challenging to consistently achieve the higher FMR rent levels. Additionally, the lack of data on days on market (DOM) indicates that rental turnover could be unpredictable, further supporting the use of market rent figures for a more accurate investment analysis.
In conclusion, while the FMR offers a marginally better gross yield, the market conditions in ZIP 05674 favor using the market rent of $1,750 annually for a more grounded assessment of potential returns. This approach aligns with the actual demand and supply dynamics, ensuring a practical outlook for investors.
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.