Location: Newark, NJ | Metro: Bergen-Passaic, NJ HUD Metro FMR Area
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 | $2,130 |
| 1 Bedroom | $2,400 |
| 2 Bedrooms | $2,900 |
| 3 Bedrooms | $3,620 |
| 4 Bedrooms | $4,140 |
| 5 Bedrooms | $4,802 |
| 6 Bedrooms | $5,378 |
| 7 Bedrooms | $5,808 |
| 8 Bedrooms | $6,098 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,900 | $361,837 | 0.8% | C |
| 3BR | $3,620 | $468,962 | 0.77% | D |
| 4BR | $4,140 | $599,282 | 0.69% | D |
U.S. Census Bureau data (2024)
A skeptical investor looking into ZIP 07460, Stockholm, NJ, might have several concerns regarding the viability of investing in Section 8 properties. Let's address these points directly using available data.
Will Fair Market Rent ($2870) cover the mortgage on a $429,360 home?
The Fair Market Rent (FMR) of $2870 for ZIP 07460 does not guarantee full coverage of a mortgage on a $429,360 home. To determine if it covers the mortgage, we must consider the interest rate and loan term. Assuming a 30-year fixed-rate mortgage at an average rate of 4%, the monthly payment would be approximately $2043. This means that the FMR would indeed cover the mortgage payments, leaving a surplus of around $827 per month. However, this surplus does not account for property taxes, insurance, maintenance, and other costs associated with property ownership.
Is there enough renter demand at 14.2%?
The 14.2% rental rate in Stockholm, NJ, suggests a moderate level of demand. While this percentage is not exceptionally high, it indicates a stable rental market. For context, the national average rental rate is around 35%. The lower rental rate in ZIP 07460 could mean that homeownership is more prevalent, but it also implies less competition among landlords. Given the stability of Section 8 tenants, who have their rent subsidized, this demand level should be sufficient for maintaining occupancy rates.
Will vouchers keep pace with market rents?
The data provided does not specify the current trend or growth rate of voucher amounts relative to market rents in Stockholm, NJ. Without this information, it's difficult to conclusively state whether vouchers will continue to match market rents. Typically, voucher amounts are adjusted annually based on HUD's Fair Market Rents, which can lag behind actual market conditions. Landlords should monitor local housing authority updates and HUD adjustments to stay informed on potential changes.
In conclusion, while ZIP 07460 presents some challenges, the data suggests that it remains a viable investment option for Section 8 properties. The key is to carefully manage expectations and expenses, ensuring that the financials align with the long-term goals of the investor.
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.