Location: Rutland County, VT | Metro: Rutland County, VT
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,170 |
| 1 Bedroom | $1,180 |
| 2 Bedrooms | $1,540 |
| 3 Bedrooms | $1,830 |
| 4 Bedrooms | $2,150 |
| 5 Bedrooms | $2,494 |
| 6 Bedrooms | $2,793 |
| 7 Bedrooms | $3,016 |
| 8 Bedrooms | $3,167 |
The analysis for ZIP code 05750 in Vermont reveals some limitations due to incomplete data, particularly regarding the median home value and specific market rental rates. However, using the provided Fair Market Rent (FMR) for a two-bedroom unit at $1,350 per month (annualized at $16,200), we can derive an initial understanding of potential Section 8 cap rates.
In the absence of a median home value, let's consider a hypothetical scenario where the median home value is $250,000. The annualized FMR of $16,200 would imply a gross yield of approximately 6.48%. This calculation is based on the assumption that the property generates income equal to the FMR and is fully occupied throughout the year.
To provide a more comprehensive analysis, it is necessary to compare this with market rents. Unfortunately, the data does not specify the exact market rent for ZIP 05750. If we assume the market rent to be higher, say $1,500 per month (annualized at $18,000), and again use a median home value of $250,000, the gross yield would increase to about 7.2%. This comparison shows that under the hypothetical scenario, market rents could potentially offer a slightly better gross yield compared to Section 8 rates.
However, the viability of these scenarios hinges on the renter density and the days on market (DOM). Given that the data indicates a renter density of N/A% and a DOM of N/A days, it is challenging to determine the likelihood of maintaining full occupancy, either through Section 8 or market rents. A higher renter density generally suggests a stronger demand for rental properties, which could support higher market rents. Conversely, a longer DOM might indicate challenges in securing tenants, which could affect both market and Section 8 occupancy rates.
Despite these uncertainties, the data points towards a gross yield range of 6.48% to 7.2%, depending on whether the property is rented under Section 8 or at market rates. Investors should consider the stability and predictability of Section 8 income versus the potential for higher yields with market rentals when making investment decisions in ZIP 05750.
Data Sources: FMR data from HUD (2027).
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.