Location: Montgomery County, NY | Metro: Albany-Schenectady-Troy, NY 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 | $1,100 |
| 1 Bedroom | $1,280 |
| 2 Bedrooms | $1,540 |
| 3 Bedrooms | $1,840 |
| 4 Bedrooms | $2,030 |
| 5 Bedrooms | $2,355 |
| 6 Bedrooms | $2,638 |
| 7 Bedrooms | $2,849 |
| 8 Bedrooms | $2,991 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,540 | $249,114 | 0.62% | D |
| 3BR | $1,840 | $349,129 | 0.53% | F |
| 4BR | $2,030 | $403,040 | 0.5% | F |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 12137, Pattersonville, NY, reveals some key insights into potential investment opportunities. The Fair Market Rent (FMR) for a 2-bedroom apartment in this area for FY 2024 is set at $1190 annually, while the market rent based on Census ACS data stands at $3,501 per year.
To calculate the gross yield for both scenarios, we first consider the annualized FMR of $1190. Dividing this by the median home value of $314,382 yields an implied gross yield of approximately 0.38%. For the market rent scenario, using the $3,501 figure, the implied gross yield rises significantly to about 1.11%.
The stark difference between these two yields highlights the importance of understanding the local rental market dynamics. Given that only 16.9% of households in Pattersonville are renters, it suggests a limited demand for rental properties, making the market rent scenario less likely to be consistently realized. The N/A-day DOM (days on market) indicates that there might be a lack of recent sales data, which could affect the reliability of the median home value used in our calculations.
While the higher gross yield from market rents is attractive, the lower Section 8 FMR yield of 0.38% reflects a more stable, albeit less lucrative, income stream. Investors should consider the risk of vacancy and the possibility of lower tenant turnover rates when relying solely on Section 8 vouchers.
In conclusion, the gross yield comparison shows that market rents offer a much better return at 1.11%, compared to the 0.38% from Section 8 FMRs. However, the reality of a low renter density and potentially unreliable DOM data means that securing a steady income at market rates might be challenging. Therefore, for a conservative investment strategy, the Section 8 FMR scenario provides a clearer, if modest, yield expectation.
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.