Location: New York, NY | Metro: Nassau-Suffolk, NY HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $2,450 |
| 1 Bedroom | $2,860 |
| 2 Bedrooms | $3,360 |
| 3 Bedrooms | $4,320 |
| 4 Bedrooms | $4,590 |
| 5 Bedrooms | $5,324 |
| 6 Bedrooms | $5,963 |
| 7 Bedrooms | $6,440 |
| 8 Bedrooms | $6,762 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 11020 reveals an interesting dynamic between government-subsidized rents and market rates. For the fiscal year 2024, the Fair Market Rent (FMR) for a two-bedroom apartment in this area is set at $2,870 per month. This translates into an annual rental income of $34,440. In contrast, the market rent for a similar property, based on Census ACS data, stands at $2,855 monthly, resulting in an annual rental income of $34,260.
To calculate the gross yield, we use the median home value of $1,603,857. The gross yield for a two-bedroom apartment under the Section 8 FMR scenario is approximately 2.15%, while the market rent scenario yields about 2.14%. These figures suggest that, in terms of gross yield, there is a negligible difference between renting to Section 8 tenants and renting at market rates in ZIP 11020.
However, considering the 13.9% renter density in the area, it becomes evident that the market rent scenario is slightly more realistic. Given that only a fraction of homeowners choose to rent, the likelihood of finding tenants willing to pay market rates is higher than securing Section 8 tenants, who often face long waiting lists and limited availability in certain areas. The lack of specific days on the market (N/A DOM) indicates that the data might be incomplete or less reliable, further supporting the focus on market conditions.
In conclusion, while the Section 8 FMR provides a stable source of income with a gross yield of 2.15%, the slight edge in gross yield offered by market rent (2.14%) combined with the higher probability of occupancy due to the local renter density makes it a more practical option for landlords and small-portfolio investors in ZIP 11020.
Data Sources: FMR data from HUD (2027). 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.