Location: Ithaca, NY | Metro: Ithaca, 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 | $1,370 |
| 1 Bedroom | $1,630 |
| 2 Bedrooms | $1,950 |
| 3 Bedrooms | $2,330 |
| 4 Bedrooms | $3,000 |
| 5 Bedrooms | $3,480 |
| 6 Bedrooms | $3,898 |
| 7 Bedrooms | $4,210 |
| 8 Bedrooms | $4,421 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,630 | $235,926 | 0.69% | D |
| 2BR | $1,950 | $294,117 | 0.66% | D |
| 3BR | $2,330 | $392,829 | 0.59% | F |
| 4BR | $3,000 | $531,990 | 0.56% | F |
| 5BR | $3,480 | $606,123 | 0.57% | F |
U.S. Census Bureau data (2024)
Ithaca, ZIP code 14850, serves as the economic and cultural hub of Tompkins County, defined largely by the presence of Cornell University and Ithaca College. This area features a mix of historic neighborhoods near downtown and student-aimed developments, creating a distinct density that supports a robust rental ecosystem. The local economy is anchored by education and healthcare, with Cornell University standing as the region's dominant employer and a primary driver of housing demand, ensuring a consistent inflow of faculty, staff, and graduate students seeking long-term housing.
From a financial perspective, the numbers reveal a tightening market. The FY2026 2-Bedroom FMR is set at $1,890, while the current ZORI market rent sits at $1,975, resulting in a narrow gap of $85. This proximity suggests voucher holders remain competitive with standard market tenants. Asset values are high, with a median home value of $404,529, though sales move at a deliberate pace, reflected in a median 89 days on market. For a typical 2BR unit priced at the median sale price of $286,236, the FMR provides a potential gross yield of roughly 7.9% annually before expenses.
The tenant pool is deep, driven by a 55.2% renter share and a median household income of $71,445. While this income level is healthy, the high cost of living pushes many families toward rental assistance programs. Demand is further bolstered by the area’s highly rated public school system and the TCAT bus network, which connects residential zones to major employment centers. These amenities make the area attractive to Section 8 families seeking stability and access to quality education.
The strongest investor angle here is stability coupled with appreciation. Because the $1,890 FMR nearly matches market rates, investors avoid the typical "voucher discount" while accessing a tenant base backed by federal subsidies. With a major university ensuring long-term economic vitality and a high renter population, cash flow is protected by consistent demand rather than speculative spikes. This market favors buy-and-hold investors seeking reliable occupancy over rapid turnover.
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.