Section 8 Fair Market Rent (FMR) for ZIP 10027 - 2026

Market Overview: ZIP 10027 (Harlem/Morningside Heights) is a high-demand, transit-rich zone with strong rental demand from Columbia University, City College, and medical-center workforce. Median list prices have risen ~8% YoY, driven by limited inventory and investor demand. Cash-flow potential remains strong, but investors should budget for higher acquisition costs and expect cap rates to compress further.

Median Sales Prices (ZIP 10027):

• 2BR: $850,000
• 3BR: $1,050,000

1% Rule Analysis:

• 2BR: $2,700 ÷ $850,000 = 0.32% Below 1% Rule
• 3BR: $3,380 $1,050,000 = 0.32% 👎 Below 1% Rule

Investment Potential: High acquisition cost and compressed cap rates limit cash-on-cash returns. Investors should focus on value-add opportunities (renovation, ADU, short-term rental conversion) to offset the 1% Rule shortfall. Strong rental demand from students and medical professionals supports steady cash flow, but investors must budget for higher purchase prices and expect lower cap rates compared to other U.S. markets.

Key Insights:

• High acquisition cost vs. FMR: expect to pay ~$850k for a 2BR and ~$1.05M for a 3BR unit.
• 1% Rule shortfall: expect to pay ~$850k for a 2BR unit that rents for only $2,700/month.
• Strong rental demand from Columbia University, City College, and medical-center workforce.
• Investors should focus on value-add opportunities (renovation, ADU, short-term rental conversion) to offset the 1% Rule shortfall.