Location: Philadelphia-Camden-Wilmington, PA | Metro: Philadelphia-Camden-Wilmington, PA-NJ-DE-MD 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 | $1,580 |
| 1 Bedroom | $1,720 |
| 2 Bedrooms | $2,050 |
| 3 Bedrooms | $2,440 |
| 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: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,050 | $305,004 | 0.67% | D |
| 3BR | $2,440 | $404,874 | 0.6% | D |
| 4BR | $2,690 | $478,150 | 0.56% | F |
| 5BR | $3,120 | $522,912 | 0.6% | F |
U.S. Census Bureau data (2024)
The analysis for ZIP code 08060, Mt Holly Township, NJ, reveals a distinct difference between the potential gross yields derived from Section 8 Housing Vouchers and market rents. For a two-bedroom unit, the Fair Market Rent (FMR) for FY 2024 is set at $1,880 annually, while the Zillow Observed Rental Index (ZORI) indicates a market rent of $2,017 per month. Given the median home value in the area is $400,673, we can calculate the implied gross yields for both scenarios.
In the case of Section 8 vouchers, the annual rental income would be $1,880 multiplied by 12, equating to $22,560. This amount represents an implied gross yield of approximately 5.63% when compared to the median home value. On the other hand, if the unit were rented at market rates, the monthly income of $2,017 translates to an annual income of $24,204, implying a gross yield of about 6.04% based on the same median home value.
Given the 26.0% renter density and the average Days on Market (DOM) of 25 days, it is reasonable to conclude that market rents offer a slightly more realistic scenario for potential gross yields. The higher gross yield from market rents reflects the competitive nature of the local rental market and the demand for housing in the area. However, the stability and lower vacancy risk associated with Section 8 vouchers can provide a consistent cash flow, despite the lower gross yield. Landlords and small-portfolio investors must weigh these factors according to their investment goals and risk tolerance.
To summarize, the gross yield from a two-bedroom unit under Section 8 is 5.63%, whereas renting at market rates yields a 6.04% gross return. Market rents offer a marginally better financial outcome, but the benefits of Section 8, such as reduced turnover and government-backed payments, should also be considered in the investment decision-making process.
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.