Location: Montgomery County, NY | Metro: Fulton County, NY
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 | $810 |
| 1 Bedroom | $810 |
| 2 Bedrooms | $1,030 |
| 3 Bedrooms | $1,260 |
| 4 Bedrooms | $1,380 |
| 5 Bedrooms | $1,601 |
| 6 Bedrooms | $1,793 |
| 7 Bedrooms | $1,936 |
| 8 Bedrooms | $2,033 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,030 | $195,153 | 0.53% | F |
| 3BR | $1,260 | $239,288 | 0.53% | F |
| 4BR | $1,380 | $267,748 | 0.52% | F |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 12068 (Fonda, NY) reveals some interesting dynamics when comparing the Federal Market Rent (FMR) and market rent figures against the median home value. For a two-bedroom unit, the annualized FMR for FY 2026 is $12,120 ($1,010 per month), while the market rent based on Census ACS data is $10,812 ($901 per month).
To calculate the implied gross yield, we use the median home value of $222,028. The gross yield from the FMR scenario is approximately 5.46%, calculated as $12,120 divided by $222,028. Conversely, the gross yield from the market rent scenario is about 4.87%, calculated as $10,812 divided by $222,028.
The higher gross yield from the FMR scenario suggests a potentially better return on investment for landlords participating in the Section 8 program. However, the reality of rental markets must be considered. With only 19.5% of the population renting, the demand for rental properties, including those in the Section 8 program, may be limited. This could affect the ability to consistently achieve the FMR rent, especially if the vacancy rates are high due to low renter density.
The N/A-day DOM (days on market) indicates that there might not be sufficient data to assess the average time it takes to lease a property. This lack of information could imply either a very efficient leasing process or an underreported statistic, which would need further investigation. In any case, the limited renter base in Fonda, NY, makes the market rent scenario more plausible for long-term stability.
In conclusion, while the FMR offers a higher gross yield at 5.46%, the market rent scenario, with a gross yield of 4.87%, reflects the actual rental environment more accurately. Landlords and small-portfolio investors should weigh the potential for achieving higher rents against the risk of lower demand and possibly longer vacancies.
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.