Location: Erie, 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 | $980 |
| 1 Bedroom | $1,110 |
| 2 Bedrooms | $1,410 |
| 3 Bedrooms | $1,750 |
| 4 Bedrooms | $2,070 |
| 5 Bedrooms | $2,401 |
| 6 Bedrooms | $2,689 |
| 7 Bedrooms | $2,904 |
| 8 Bedrooms | $3,049 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,410 | $182,798 | 0.77% | D |
| 3BR | $1,750 | $272,024 | 0.64% | D |
| 4BR | $2,070 | $402,698 | 0.51% | F |
| 5BR | $2,401 | $528,809 | 0.45% | F |
U.S. Census Bureau data (2024)
Erie, PA's ZIP code 16506 represents a neighborhood with a total population of 24,070 residents. In this area, 31.5% of the inhabitants are renters, indicating a significant portion of the community relies on rental housing. The median household income in ZIP 16506 stands at $81,060, reflecting a moderate economic status among its residents. Additionally, the median home value in this ZIP code is $284,953, which provides insight into the overall property values and the financial investment required to own a home here.
Moving into the specifics of rental economics, the Fair Market Rent (FMR) for ZIP 16506 in fiscal year 2024 is set at $1,200. This figure contrasts sharply with the market rent, known as ZORI (Zillow Observed Rent Index), which is $1,840. The discrepancy between these two numbers suggests that there is potential for landlords to receive higher rents through the market compared to the subsidized rates offered under the Section 8 program.
The practical implications for investors are clear. For those seeking a hands-off approach, where the focus is on maintaining properties rather than actively managing them, ZIP 16506 might not be the most attractive option due to the lower FMR compared to market rates. However, for hands-on value-add buyers who are willing to invest time and resources into improving their properties, this ZIP code presents an opportunity. By enhancing the quality and appeal of their rental units, such investors can potentially command market rents above the FMR, thus maximizing their returns while still benefiting from the stability provided by Section 8 tenants.
In conclusion, ZIP 16506 in Erie, PA, offers a balanced environment for real estate investment, with a mix of renters and homeowners, moderate income levels, and property values that align well with both FMR and market rents. The decision to invest here should hinge on whether the investor prefers passive management or active involvement in property improvement and market positioning.
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.