Location: Mercer County, PA | Metro: Mercer County, PA
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 | $710 |
| 1 Bedroom | $800 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,410 |
| 4 Bedrooms | $1,600 |
| 5 Bedrooms | $1,856 |
| 6 Bedrooms | $2,079 |
| 7 Bedrooms | $2,245 |
| 8 Bedrooms | $2,357 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,010 | $165,922 | 0.61% | D |
| 3BR | $1,410 | $247,339 | 0.57% | F |
| 4BR | $1,600 | $313,138 | 0.51% | F |
U.S. Census Bureau data (2024)
A skeptical investor looking into ZIP 16137, Mercer, PA, might have several concerns regarding the viability of investing in rental properties here. Let's address these objections head-on using available data.
Objection 1: Will Fair Market Rent (FMR) of $850 (for ZIP 16137 in fiscal year 2024) cover the mortgage on a $216,590 home?
The FMR of $850 is indeed an important consideration when evaluating whether the rent can cover the mortgage payments. However, without the specific interest rate and loan terms, it's challenging to provide a definitive answer. Assuming a typical 30-year fixed-rate mortgage and a current average interest rate, the monthly payment on a $216,590 home could range widely depending on the down payment and other factors. At an interest rate of around 5%, a 20% down payment would result in a monthly mortgage payment of approximately $960. This means that the FMR alone wouldn't cover the mortgage, necessitating either a higher rent or additional income sources. For a more precise analysis, consult a mortgage calculator with current rates.
Objection 2: Is there enough renter demand at 19.7%?
The percentage of households renting at 19.7% suggests a relatively low demand compared to areas where renters constitute a larger share of the population. However, this figure alone doesn't tell the whole story. It's essential to consider the total number of households in ZIP 16137. With a smaller rental market, the competition might be less intense, making it easier to attract tenants. Additionally, the local economy and job market play a crucial role in sustaining rental demand. A deeper dive into the employment trends and the types of jobs available in Mercer, PA, would provide a clearer picture of the potential for steady tenant occupancy.
Objection 3: Will vouchers keep pace with $680 market rents?
The question of whether Housing Choice Vouchers will align with the $680 market rents is critical for landlords considering Section 8 properties. According to HUD guidelines, voucher amounts are adjusted annually based on the FMR and local housing costs. Given that the FMR is set at $850 for fiscal year 2024, it's reasonable to expect that voucher amounts will also rise, potentially covering more of the $680 market rent. However, the exact amount varies by county and household size. To ensure accuracy, landlords should verify the latest voucher payment standards for Mercer County, PA. While vouchers might not fully cover the rent, they often come with the advantage of guaranteed payment through the government, reducing the risk of unpaid rent.
In conclusion, while ZIP 16137 presents some challenges, such as the need for supplemental income beyond rent to cover mortgage payments and a modest rental market, the potential for voucher coverage offers a degree of financial security. Each investment decision should be made with a thorough understanding of local economic conditions and a careful review of current mortgage and voucher 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.