Location: Waterbury-Shelton, CT | Metro: Hartford-West Hartford-East Hartford, CT MSA
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 | $1,190 |
| 1 Bedroom | $1,270 |
| 2 Bedrooms | $1,660 |
| 3 Bedrooms | $2,080 |
| 4 Bedrooms | $2,470 |
| 5 Bedrooms | $2,865 |
| 6 Bedrooms | $3,209 |
| 7 Bedrooms | $3,466 |
| 8 Bedrooms | $3,639 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,270 | $223,843 | 0.57% | F |
| 2BR | $1,660 | $357,709 | 0.46% | F |
| 3BR | $2,080 | $498,333 | 0.42% | F |
| 4BR | $2,470 | $667,290 | 0.37% | F |
| 5BR | $2,865 | $719,312 | 0.4% | F |
U.S. Census Bureau data (2024)
In evaluating the viability of investing in ZIP 06410, Cheshire, Connecticut, under the Section 8 program, several key concerns arise. Let's address them directly.
Objection 1: Will Fair Market Rent (FMR) of $1740 per month for ZIP 06410 in fiscal year 2024 cover the mortgage on a home priced at $528,647?
The FMR of $1740 per month is indeed a critical figure for determining rental income under the Section 8 program. To put this into perspective, let’s consider the average mortgage payment for a home valued at $528,647. Assuming a 30-year fixed-rate mortgage at an interest rate of 4.5%, the monthly mortgage payment would be approximately $2,577. This means that the FMR does not fully cover the mortgage payment, leaving a shortfall of around $837 per month. However, it’s important to note that this calculation does not account for potential tax benefits or other subsidies that might offset some of the costs.
Objection 2: Is there enough renter demand at 13.3%?
The rental demand in ZIP 06410 is relatively low at 13.3%. This percentage suggests that only a small portion of the housing stock is dedicated to rentals. While this may seem concerning, it also indicates a potentially competitive market for landlords who can offer attractive properties. The lower demand could mean fewer vacancies but also higher competition among landlords for tenants. It's crucial to understand that while 13.3% is below the national average, it still represents a significant number of units available for rent, especially considering the demographic makeup of Cheshire, which tends to favor homeownership.
Objection 3: Will vouchers keep pace with market rents of $2,394?
The current market rent in ZIP 06410 is $2,394, significantly higher than the FMR of $1740. This gap highlights a challenge for voucher holders, who may struggle to find suitable housing within their budget. However, the Section 8 program aims to ensure that rents do not exceed 30% of a household’s income. If the local median income is sufficient, the voucher amount could increase to match the higher market rents. But given the existing data, there is no guarantee that the voucher amounts will rise to meet the $2,394 market rents. Investors must weigh the risk of accepting lower rents against the potential for higher vacancy rates if they insist on market rents.
In conclusion, while ZIP 06410 presents some challenges, such as the gap between FMR and mortgage payments, and the lower rental demand, these factors do not necessarily preclude successful investment. Careful consideration of additional financial benefits and thorough understanding of the local rental market dynamics are essential.
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.