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 | $740 |
| 1 Bedroom | $790 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,280 |
| 4 Bedrooms | $1,450 |
| 5 Bedrooms | $1,682 |
| 6 Bedrooms | $1,884 |
| 7 Bedrooms | $2,035 |
| 8 Bedrooms | $2,137 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,010 | $107,477 | 0.94% | C |
| 3BR | $1,280 | $106,969 | 1.2% | B |
| 4BR | $1,450 | $135,489 | 1.07% | B |
| 5BR | $1,682 | $133,682 | 1.26% | A |
U.S. Census Bureau data (2024)
A skeptical investor considering Salamanca, NY (ZIP 14779), might raise several concerns regarding the viability of investing in Section 8 properties. Let's delve into these objections with the available data.
Will FMR $980 (metro FY 2026) cover the mortgage on a $104,609 home?
The Fair Market Rent (FMR) for the Salamanca area is set at $980 for fiscal year 2026. This figure represents the average monthly rent that a landlord could expect from a tenant participating in the Section 8 program. To determine if this will cover the mortgage on a $104,609 home, we need to calculate the potential monthly mortgage payment. Assuming a 30-year fixed-rate mortgage with an interest rate of 4%, the monthly principal and interest payment would be approximately $500. This amount is well below the FMR of $980, suggesting that the rent collected should comfortably cover the mortgage payment, even with some buffer for maintenance and other expenses.
Is there enough renter demand at 40.6%?
The rental vacancy rate in Salamanca is 40.6%, which is quite high compared to national averages. A high vacancy rate can be a cause for concern, as it implies a significant portion of rental units are unoccupied. However, it also indicates that there is room for new investments without necessarily driving down rents. While the vacancy rate is a critical metric, it does not tell the whole story. The number of households and the percentage of renters who are eligible for Section 8 benefits must also be considered. Without specific data on the number of Section 8 applicants and the size of the rental market, it is challenging to definitively state whether there is sufficient demand. Yet, the high vacancy rate suggests that landlords have the flexibility to adjust their offerings to attract tenants.
Will vouchers keep pace with $697 market rents?
The market rent for a two-bedroom apartment in Salamanca is $697, which is notably lower than the FMR of $980. This discrepancy is important because it reflects the actual rental market conditions. The question of whether vouchers will keep pace with market rents depends on the local housing authority's policies and funding levels. Nationally, voucher amounts can lag behind FMRs, but they generally aim to cover a substantial portion of market rents. Given the lower market rent of $697, landlords should find that voucher payments are adequate to cover costs. However, the exact amount of the voucher and its ability to adjust annually must be verified through the local housing agency to ensure long-term financial stability.
In summary, while the high vacancy rate of 40.6% and the potential for voucher payments to lag behind market rents pose challenges, the FMR of $980 provides a solid basis for covering mortgage payments on a $104,609 home. Investors should conduct further research on local Section 8 policies and the number of eligible applicants to make a fully informed decision.
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.