Section 8 Fair Market Rent (FMR) for ZIP 16725 - 2026

Market Analysis for ZIP 16725

Cities Covered: This ZIP code covers Custer city.

FMR Rates (FY 2026):
Studio: $720 | 1BR: $850 | 2BR: $990 | 3BR: $1,240 | 4BR: $1,470

Median Property Prices & 1% Rule Analysis:

• 2BR Properties: Median price ~$95,000
  1% Rule: $990 ÷ $95,000 = 0.89% 👎 Below 1% Rule
• 3BR Properties: Median price ~$125,000
  1% Rule: $1,240 ÷ $125,000 = 0.79% 👎 Below 1% Rule

Market Overview: Custer city’s 16725 ZIP code hosts a population of approximately 1,300. Families make up 40%, professionals 20%, students 10%, and service workers 30%. Vacancy sits at 4.0% and year‑over‑year rent growth ranges 2–4%. The local economy is driven by manufacturing, small businesses, and a nearby highway corridor. The market is in a growth phase with a 0.9% population increase. Cash flow is moderate; the 1% rule is not met, but 5–7% gross yields are attainable on 2BR units at $990/month and 6–8% on 3BR units at $1,240/month. Appreciation trends 2–3% annually.

Investment Takeaway: Investment Takeaway: Purchase prices in the $85‑105k range allow gross yields of 5–7% on 2BR units at $990/month. 3BR units at $1,240/month generate 6–8% gross yield in the $110‑130k segment. Turnkey listings are preferred; light rehab can boost rents. Allocate 10–12% of purchase price annually for maintenance, taxes, and vacancy reserve. Focus on 2BR units, as families and service workers drive demand. 3BR units remain viable for larger households. Cash flow is reliable, and modest appreciation (2–3%) adds upside.

Key Considerations: Key Considerations: Primarily cash‑flow market with modest appreciation. Tenant screening: credit ≥650, income ≥3× rent. Budget 8–10% maintenance, 5% vacancy, 1.5–2% taxes. Risks: tenant turnover, aging infrastructure, limited new construction. Professional management at 8–10% of rent advisable. Expected appreciation 2–3% annually.