Location: Waterbury-Shelton, CT | Metro: Waterbury-Shelton, 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 | $1,130 |
| 1 Bedroom | $1,310 |
| 2 Bedrooms | $1,610 |
| 3 Bedrooms | $1,990 |
| 4 Bedrooms | $2,350 |
| 5 Bedrooms | $2,726 |
| 6 Bedrooms | $3,053 |
| 7 Bedrooms | $3,297 |
| 8 Bedrooms | $3,462 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,610 | $218,236 | 0.74% | D |
| 3BR | $1,990 | $304,183 | 0.65% | D |
| 4BR | $2,350 | $342,140 | 0.69% | D |
| 5BR | $2,726 | $416,327 | 0.65% | D |
U.S. Census Bureau data (2024)
Skeptical investors considering Waterbury, CT (ZIP 06710) for their Section 8 portfolios often have several concerns. One common objection is whether the Fair Market Rent (FMR) of $1,410 for the fiscal year 2024 will adequately cover the mortgage on a home priced at $295,718. The FMR represents the maximum amount that HUD will pay for a rental unit. To determine if it covers the mortgage, one must consider the interest rate and loan terms. Assuming a standard 30-year fixed-rate mortgage at an average rate of 5%, the monthly payment on a $295,718 home would be approximately $1,580. This means the FMR of $1,410 does not fully cover the mortgage, leaving a shortfall of around $170 per month.
Another concern is the level of renter demand, which stands at 66.3%. This percentage indicates that over two-thirds of the population in ZIP 06710 are potential renters. However, the critical question is whether this demand translates into a steady stream of qualified tenants. While the demand is strong, it's important to note that the percentage alone does not guarantee the quality or quantity of applicants. Landlords should look at local vacancy rates and the number of Section 8 households to gauge actual demand.
The final objection centers on the ability of Housing Choice Vouchers to keep up with market rents. In ZIP 06710, the average market rent is $1,488. HUD's FMR of $1,410 is slightly below this figure, suggesting that voucher holders might struggle to find units within their budget. However, it's worth noting that landlords can negotiate with voucher holders to cover the difference between the FMR and the market rent, though this requires agreement from both parties. Additionally, the federal government periodically adjusts the FMR to reflect changes in the housing market, but these adjustments may not always align perfectly with local conditions.
In conclusion, while the data provides some insights, it's clear that the FMR of $1,410 does not fully cover the mortgage on a $295,718 home in ZIP 06710. There is a significant renter demand at 66.3%, but this does not necessarily translate into an abundance of qualified tenants. Lastly, the discrepancy between the FMR and market rents of $1,488 indicates that voucher holders may face challenges in finding affordable units, although landlords have options to adjust the rent. These points highlight the need for careful consideration and planning when investing in Section 8 properties in this area.
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.