Location: Yates County, NY | Metro: Steuben 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 | $920 |
| 1 Bedroom | $930 |
| 2 Bedrooms | $1,140 |
| 3 Bedrooms | $1,480 |
| 4 Bedrooms | $1,890 |
| 5 Bedrooms | $2,192 |
| 6 Bedrooms | $2,455 |
| 7 Bedrooms | $2,651 |
| 8 Bedrooms | $2,784 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,140 | $176,339 | 0.65% | D |
| 3BR | $1,480 | $192,842 | 0.77% | D |
| 4BR | $1,890 | $207,792 | 0.91% | C |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 14873, located in Prattsburgh, NY, reveals a significant disparity between the federally mandated Fair Market Rent (FMR) and the actual market rents. For a two-bedroom property, the annualized FMR set by the government for FY 2024 is $1070 per month, while the Census ACS reports the market rent at $1,088 per month.
Using these figures against the median home value of $154,321, we can calculate the implied gross yield for both scenarios. For the FMR scenario, the annual rent would be $12,840 ($1070 x 12 months), resulting in an implied gross yield of approximately 8.3%. Conversely, the market rent scenario yields an annual rent of $13,056 ($1,088 x 12 months), leading to a slightly higher implied gross yield of around 8.5%.
Given the low renter density of 11.5%, it becomes evident that the FMR scenario is less likely to materialize in practice. The low percentage of renters suggests a limited demand for rental properties, making it challenging to find tenants willing to pay only the FMR. This situation is further complicated by the lack of data on the days-on-market (DOM) for rental listings, which could provide insights into the competitive dynamics of the local rental market.
In conclusion, while the FMR-based gross yield stands at 8.3%, the more realistic market rent-based gross yield is 8.5%. Landlords and small-portfolio investors should focus on the market rent figure when assessing potential returns in ZIP 14873, considering the low renter population and the absence of timely DOM data. The slight difference in gross yields underscores the importance of aligning with market realities rather than solely relying on government-set rates.
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.