Location: Newark, NJ | Metro: Newark, 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 | $1,880 |
| 1 Bedroom | $2,120 |
| 2 Bedrooms | $2,560 |
| 3 Bedrooms | $3,190 |
| 4 Bedrooms | $3,650 |
| 5 Bedrooms | $4,234 |
| 6 Bedrooms | $4,742 |
| 7 Bedrooms | $5,121 |
| 8 Bedrooms | $5,377 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,560 | $404,139 | 0.63% | D |
| 3BR | $3,190 | $497,910 | 0.64% | D |
| 4BR | $3,650 | $829,548 | 0.44% | F |
U.S. Census Bureau data (2024)
In ZIP 07852 (Ledgewood, NJ), a common concern among investors is whether the Fair Market Rent (FMR) of $2,230 for 2024 will be sufficient to cover the mortgage on a home priced at $528,557. According to recent mortgage rates, a typical 30-year fixed-rate mortgage could result in a monthly payment of approximately $2,300 to $2,500, depending on the down payment and interest rate. Given that the FMR is slightly below this range, it indicates that covering the mortgage solely through Section 8 rental income might be challenging without additional revenue sources.
Another objection is the level of renter demand at 17.0%. The data shows that the percentage of renter-occupied units in ZIP 07852 is relatively low. This suggests that there may be limited demand for rental properties in the area, particularly those seeking Section 8 tenants. However, the percentage alone does not provide a complete picture of the actual number of potential tenants. Additional research into the specific demographics and economic conditions of Ledgewood would be necessary to better understand the demand for rental properties.
The final concern is whether Section 8 vouchers will keep pace with market rents of $2,118. The waiting list for Section 8 vouchers in Ledgewood is currently closed, indicating a high demand for subsidized housing. While this suggests that the voucher program is active and in use, it does not guarantee that the voucher amounts will match the market rents. Historically, voucher amounts have lagged behind market rents, but the exact gap in Ledgewood is unclear without more specific data.
To summarize, while the FMR in ZIP 07852 is close to the expected mortgage payments, it may not fully cover them. The renter demand appears to be lower than desirable, but the actual number of potential tenants requires further investigation. Lastly, the trend of voucher amounts not keeping up with market rents poses a risk, although the precise impact in Ledgewood remains uncertain.
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.