Section 8 Fair Market Rent (FMR) for ZIP 06340 - 2027

Location: Norwich-New London-Willimantic, CT | Metro: Norwich-New London-Willimantic, CT MSA

Investment Score for ZIP 06340

Monthly Rent (2BR)

$2,090

Median Price (2BR)

$291,556

1% Rule

0.72%

Annual Yield

8.6%

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,460
1 Bedroom	$1,670
2 Bedrooms	$2,090
3 Bedrooms	$2,660
4 Bedrooms	$3,290
5 Bedrooms	$3,816
6 Bedrooms	$4,274
7 Bedrooms	$4,616
8 Bedrooms	$4,847

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,670	$209,129	0.8%	D
2BR	$2,090	$291,556	0.72%	D
3BR	$2,660	$414,462	0.64%	D
4BR	$3,290	$609,039	0.54%	F
5BR	$3,816	$1,135,637	0.34%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

Population

29,863

Median Household Income

$81,792

Housing Units

14,359

Renter Percentage

55.5%

Occupancy Rate

89.7%

Renter Occupied

7,148

The classification of ZIP 06340 (Groton, CT) on the axes of yield and stability reveals a market that leans towards providing steady cash flow rather than high-yield/low-stability opportunities. This assessment is driven by specific figures from the data provided.

Firstly, let's examine the yield. The Fair Market Rent (FMR) for ZIP 06340 in fiscal year 2024 is set at $1,630, while the average market rent stands at $1,967. Given the median home value of $371,578, these rental figures suggest a moderate yield. Landlords can expect to earn a slightly higher return above the FMR threshold, but it's not indicative of a highly speculative market where rapid appreciation or turnover would be expected.

Moving onto stability, the market shows signs of relative security. With 55.5% of the population being renters, there is a substantial demand for housing rentals. Although the data does not provide the number of days on market (DOM), the median household income of $81,792 indicates that residents have a reasonable ability to pay rent. This income level supports a stable tenant base, which is crucial for maintaining consistent cash flows over time.

To further illustrate the point, consider the following:

Rental Income Potential: At $1,967 per month, an investor could generate approximately $23,604 annually from a single rental property. This figure, combined with the relatively low vacancy rate implied by the high percentage of renters, points towards a reliable source of income.
Home Value: A median home value of $371,578 suggests that the investment in a rental property would be significant. However, the potential for long-term appreciation and the stability of the rental income make it a viable option for those looking to build a portfolio rather than engage in short-term flipping.
Tenant Stability: The median income of $81,792 provides tenants with a buffer against economic downturns, reducing the risk of default or eviction. This is particularly important in a market where yields are not exceptionally high, ensuring that the returns are more predictable and less volatile.

In conclusion, ZIP 06340 (Groton, CT) represents a steady-cashflow zone rather than a high-yield/low-stability market. The combination of a moderate rental yield and a stable tenant base makes it a suitable location for investors seeking reliable returns over the long term, without the risks associated with high-turnover areas.

Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.