Location: Orleans County, VT | Metro: Caledonia County, VT
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,190 |
| 1 Bedroom | $1,210 |
| 2 Bedrooms | $1,420 |
| 3 Bedrooms | $1,920 |
| 4 Bedrooms | $2,250 |
| 5 Bedrooms | $2,610 |
| 6 Bedrooms | $2,923 |
| 7 Bedrooms | $3,157 |
| 8 Bedrooms | $3,315 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 05839 provides insight into the potential returns for landlords and small-portfolio investors. Based on the Fair Market Rent (FMR) for a 2-bedroom apartment set at $1,030 annually for fiscal year 2026, and the market rent of $973, we can derive two distinct gross-yield scenarios.
First, using the annualized FMR of $1,030, the annual rental income for a 2-bedroom property would be $12,360. Given the median home value in ZIP 05839 is $295,311, the implied gross-yield for a property rented through Section 8 would be approximately 4.2%. This is calculated by dividing the annual rental income ($12,360) by the median home value ($295,311).
Second, using the market rent figure of $973, the annual rental income for a 2-bedroom property would be $11,676. The implied gross-yield in this scenario would be approximately 3.9%, calculated similarly by dividing the annual rental income ($11,676) by the median home value ($295,311).
The difference between these two yields is minimal, with the Section 8 scenario providing a slightly higher gross-yield of 4.2% compared to the market rent scenario's yield of 3.9%. However, considering the 12.0% renter density in ZIP 05839, it is important to note that the number of days on the market (DOM) is not available. This lack of data on DOM makes it challenging to predict how quickly a property might be leased under either scenario.
Despite the slight edge in gross-yield offered by the Section 8 program, the lower renter density suggests that finding tenants willing to pay market rates could be more difficult. Therefore, while the Section 8 scenario offers a marginally better gross-yield, the stability and guaranteed payment structure of the Section 8 program may outweigh the slightly higher potential yield from market rents. Investors should weigh the benefits of steady income against the slightly lower gross-yield when deciding on which rental strategy to pursue in ZIP 05839.
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.