Location: Crawford County, PA | Metro: Erie, PA 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 | $760 |
| 1 Bedroom | $860 |
| 2 Bedrooms | $1,100 |
| 3 Bedrooms | $1,350 |
| 4 Bedrooms | $1,560 |
| 5 Bedrooms | $1,810 |
| 6 Bedrooms | $2,027 |
| 7 Bedrooms | $2,189 |
| 8 Bedrooms | $2,298 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,100 | $225,998 | 0.49% | F |
| 3BR | $1,350 | $297,195 | 0.45% | F |
| 4BR | $1,560 | $362,468 | 0.43% | F |
| 5BR | $1,810 | $408,514 | 0.44% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate picture for ZIP 16412 in Edinboro, PA, reveals interesting dynamics when compared against market conditions. To derive the gross yield, we annualize the 2BR Fair Market Rent (FMR) set at $1050 per month for FY 2024, which translates to an annual rental income of $12,600. Given the median home value in the area stands at $288,883, the implied gross yield for a Section 8 property would be approximately 4.36%. This is calculated by dividing the annual rental income by the median home value.
In contrast, using the Census ACS data, the market rent for a 2BR property is listed at $882 per month, equating to an annual rental income of $10,584. The implied gross yield under these market conditions would be around 3.67%, derived similarly by dividing the annual rental income by the median home value.
The difference between the two gross yields highlights the potential benefits of participating in the Section 8 program over relying solely on market rents. However, the realism of these scenarios hinges on the local rental market's characteristics. With a renter density of 33.7%, it's evident that a significant portion of the population is already inclined towards renting, which could support higher demand for Section 8 properties. Yet, the lack of Days on Market (DOM) data leaves a critical gap in understanding how quickly properties might turn over or the competition faced by landlords.
Given the higher implied gross yield from Section 8, it suggests a potentially more stable and reliable income stream compared to market rents. Landlords and small-portfolio investors should consider the stability offered by Section 8, especially if they aim to avoid the volatility associated with the private rental market. While the market rent scenario offers a lower gross yield, it reflects the actual rental rates landlords might expect in a competitive environment where not all tenants qualify for Section 8.
In conclusion, the Section 8 gross yield of 4.36% is notably higher than the market rent gross yield of 3.67%. This makes Section 8 participation a more attractive option for those seeking a steady income source. However, the decision should also factor in the local rental market dynamics, tenant qualification processes, and any potential administrative complexities involved in managing Section 8 properties.
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.