Location: Lewis County, NY | Metro: Lewis 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 | $800 |
| 1 Bedroom | $920 |
| 2 Bedrooms | $1,090 |
| 3 Bedrooms | $1,510 |
| 4 Bedrooms | $1,710 |
| 5 Bedrooms | $1,984 |
| 6 Bedrooms | $2,222 |
| 7 Bedrooms | $2,400 |
| 8 Bedrooms | $2,520 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,090 | $195,633 | 0.56% | F |
| 3BR | $1,510 | $219,525 | 0.69% | D |
| 4BR | $1,710 | $239,287 | 0.71% | D |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 13620 in Castorland, NY, provides a detailed look at potential investment yields. To calculate the cap rates, we'll use the Federal Market Rent (FMR) for a two-bedroom apartment, which is set at $1,140 annually for fiscal year 2026, and the market rent figure of $866, derived from the Census ACS data. The median home value in this area is $205,273.
First, let's annualize the FMR. At $1,140 per month, the annual rent would be $13,680. Dividing this by the median home value gives us an implied gross yield of approximately 6.66%. This calculation assumes that the property can be rented out at the FMR rate, which is often higher than the market rate due to government subsidies.
Next, we'll consider the market rent scenario. With a monthly rent of $866, the annualized market rent would be $10,392. When divided by the median home value, this results in an implied gross yield of about 5.06%. This yield reflects the actual market conditions and what tenants might typically pay without government assistance.
Given the 26.2% renter density in Castorland, it's important to note that a significant portion of the population is already renting. However, the lack of Days on Market (DOM) data makes it challenging to assess how quickly properties can be leased, especially under Section 8. Despite this, the higher gross yield associated with the FMR suggests that Section 8 properties could offer a better return compared to standard market rentals.
However, the reality of Section 8 participation includes additional considerations such as tenant selection, lease compliance, and the potential for slower turnover rates. These factors can impact the overall profitability and must be weighed against the higher gross yield. In conclusion, while the FMR-based gross yield of 6.66% is more attractive than the market-based gross yield of 5.06%, the decision to participate in Section 8 should also factor in these operational complexities.
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.