Location: Cattaraugus County, NY | Metro: Cattaraugus 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 | $930 |
| 1 Bedroom | $990 |
| 2 Bedrooms | $1,270 |
| 3 Bedrooms | $1,600 |
| 4 Bedrooms | $1,800 |
| 5 Bedrooms | $2,088 |
| 6 Bedrooms | $2,339 |
| 7 Bedrooms | $2,526 |
| 8 Bedrooms | $2,652 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,270 | $230,597 | 0.55% | F |
| 3BR | $1,600 | $219,157 | 0.73% | D |
| 4BR | $1,800 | $206,845 | 0.87% | C |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 14101, located in Machias, NY, reveals a significant difference between the Federal Market Rent (FMR) and the actual market rent when compared to the median home value. For a two-bedroom unit, the annualized FMR for FY 2026 is set at $1,170, while the Census ACS reports the market rent at $1,058.
To calculate the gross yield, we first annualize these figures. The annualized FMR for a two-bedroom unit is $1,170 * 12 = $14,040. Given the median home value of $196,150, the implied gross yield using the FMR would be $14,040 / $196,150 = 7.15%. On the other hand, the annualized market rent is $1,058 * 12 = $12,696. This translates into an implied gross yield of $12,696 / $196,150 = 6.47%.
Given the 19.9% renter density in the area, it is more realistic to consider the market rent scenario rather than the FMR. The renter density suggests that there is a relatively low demand for rental properties, which aligns with the lower market rent. Furthermore, the N/A-day Days on Market (DOM) indicates that either the data is incomplete or the market moves slowly, which supports the idea that the actual market conditions are likely to reflect the lower market rent rather than the higher FMR.
In conclusion, the gross yield based on the FMR of 7.15% is less likely to be achieved in practice due to the limited rental market size and potential slow sales environment indicated by the DOM data. The more realistic gross yield for investors considering the Section 8 program in ZIP 14101 is the 6.47% derived from the market rent, which reflects the true economic landscape of the area.
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.