Location: Mercer County, PA | Metro: Lawrence County, PA HUD Metro FMR Area
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 |
|---|---|---|---|---|
| 3BR | $1,410 | $222,404 | 0.63% | D |
U.S. Census Bureau data (2024)
A skeptical investor considering ZIP 16159 might have several concerns regarding the feasibility of investing in rental properties. Let's address these points directly with the available data.
Will Fair Market Rent (FMR) of $850 cover the mortgage on a $176,177 home?
The Fair Market Rent (FMR) set by HUD for ZIP 16159 in fiscal year 2024 is $850. This figure represents the maximum amount that can be charged for a voucher-assisted unit. To determine if this covers the mortgage, we need to calculate the monthly mortgage payment. Assuming a typical mortgage rate of around 4.5%, the monthly mortgage payment for a $176,177 home would be approximately $870. This means that the FMR of $850 does not fully cover the mortgage payment, leaving a shortfall of $20 per month.
Is there enough renter demand at 19.8%?
The rental vacancy rate in ZIP 16159 stands at 19.8%. This percentage is relatively high, indicating that there could be a significant amount of rental units available compared to the number of renters seeking housing. However, it's important to note that even with a high vacancy rate, there is still demand for rental properties, especially those that are well-maintained and competitively priced. The key will be to ensure that the property offers value to potential tenants, thus attracting them despite the competition from other vacant units.
Will vouchers keep pace with $880 market rents?
The current market rent in ZIP 16159 is $880. Given that the FMR is set lower at $850, it suggests that voucher holders may struggle to find units within their budget. This could potentially lead to a mismatch between the supply of voucher-supported tenants and the market rent, which could be a challenge for landlords who rely on vouchers to fill their units. It's crucial to monitor how local housing authorities adjust voucher amounts to align with market conditions.
In conclusion, while the data presents some challenges—such as the FMR not covering the full mortgage payment and a relatively high vacancy rate—it also highlights opportunities for landlords who can manage their properties effectively and adapt to the local market dynamics. The discrepancy between FMR and market rents poses a risk but also underscores the importance of understanding the local housing authority's policies and tenant preferences.
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.