Location: New York, NY | Metro: New York, NY 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 | $3,120 |
| 1 Bedroom | $3,290 |
| 2 Bedrooms | $3,580 |
| 3 Bedrooms | $4,530 |
| 4 Bedrooms | $4,970 |
| 5 Bedrooms | $5,765 |
| 6 Bedrooms | $6,457 |
| 7 Bedrooms | $6,974 |
| 8 Bedrooms | $7,323 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $3,580 | $559,521 | 0.64% | D |
| 3BR | $4,530 | $1,098,417 | 0.41% | F |
| 4BR | $4,970 | $1,323,370 | 0.38% | F |
| 5BR | $5,765 | $1,701,936 | 0.34% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 10804 in New Rochelle, NY, reveals a significant disparity between government-subsidized rental income and market rents, impacting potential gross yields for investors.
Based on the Fair Market Rent (FMR) for a two-bedroom apartment set at $2960 annually for fiscal year 2024, the implied gross yield would be approximately 0.25%. This is calculated by dividing the annual rental income ($2960) by the median home value ($1,203,677), resulting in a yield of 0.25%. This figure reflects the lower income levels subsidized by the government, which can be less attractive to landlords and small-portfolio investors seeking higher returns.
In contrast, using the market rent figure of $2,210 per month derived from the Census ACS, the annualized market rent would be $26,520. When this amount is compared against the median home value of $1,203,677, the implied gross yield increases to about 2.2%. This represents a much more favorable return for investors who might be considering market rents over Section 8 subsidies.
Given the 4.2% renter density in the area, it's important to note that the majority of homeowners are likely owner-occupiers rather than landlords. The N/A-day DOM (days on market) suggests that homes in this area sell quickly, indicating strong demand and possibly limited availability for rental properties. However, the low renter density implies that the pool of potential Section 8 tenants is smaller, making the higher gross yield from market rents more realistic for most investors.
While the Section 8 program provides a stable source of income, the gross yield of 0.25% is substantially lower than the market yield of 2.2%. For landlords and small-portfolio investors looking to maximize returns, market rents offer a better financial outlook despite the challenges posed by the relatively low renter population and quick sales of homes in the area.
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.