Location: Philadelphia-Camden-Wilmington, PA | Metro: Atlantic City-Hammonton, 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 | $1,340 |
| 1 Bedroom | $1,510 |
| 2 Bedrooms | $1,830 |
| 3 Bedrooms | $2,430 |
| 4 Bedrooms | $2,690 |
| 5 Bedrooms | $3,120 |
| 6 Bedrooms | $3,494 |
| 7 Bedrooms | $3,774 |
| 8 Bedrooms | $3,963 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,830 | $286,340 | 0.64% | D |
| 3BR | $2,430 | $402,830 | 0.6% | D |
| 4BR | $2,690 | $514,772 | 0.52% | F |
| 5BR | $3,120 | $553,825 | 0.56% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 08037, Hammonton, New Jersey, provides a detailed look at the potential returns for landlords and small-portfolio investors. The Fair Market Rent (FMR) for a two-bedroom apartment in this area, as set by HUD for FY 2024, is $1,700 annually. In contrast, the market rent for a similar unit, based on Census ACS data, stands at $1,523 per month.
To derive the gross yield for both scenarios, we first annualize the market rent, which comes to $18,276 per year. Given the median home value of $373,376 in the area, the implied gross yield for the Section 8 scenario is approximately 4.56%, calculated by dividing the annualized FMR ($1700 x 12 months) by the median home value. For the market rent scenario, the gross yield is slightly higher at 4.90%, calculated by dividing the annualized market rent ($18,276) by the median home value.
The difference between these yields is minimal, indicating that the financial performance of properties under Section 8 versus market rent conditions is relatively close. However, considering the 23.4% renter density in Hammonton, it is more realistic to assume that the majority of rental units will operate closer to market rates. This is because a significant portion of the population is likely to be able to afford market rents, reducing the reliance on Section 8 subsidies.
The N/A-day DOM (Days On Market) suggests that there is no readily available data on how long properties typically stay on the market before being rented, which could be due to a variety of factors including strong demand, quick turnover, or limited supply. Despite this, the higher gross yield associated with market rents makes them a more attractive option for most landlords and investors in Hammonton, NJ. This does not mean that Section 8 properties are unprofitable; they simply offer a slightly lower gross yield compared to market rate rentals.
In conclusion, while the gross yield for Section 8 properties in ZIP 08037 is 4.56%, and for market rate properties it is 4.90%, the latter is more likely to reflect the typical rental scenario given the local renter demographics. Investors should consider these figures when evaluating potential investments in the area.
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.