Section 8 Fair Market Rent (FMR) for ZIP 17331 - 2027

Investment Score for ZIP 17331

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,000
1 Bedroom	$1,080
2 Bedrooms	$1,370
3 Bedrooms	$1,830
4 Bedrooms	$1,930
5 Bedrooms	$2,239
6 Bedrooms	$2,508
7 Bedrooms	$2,709
8 Bedrooms	$2,844

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,080	$158,311	0.68%	D
2BR	$1,370	$231,721	0.59%	F
3BR	$1,830	$288,814	0.63%	D
4BR	$1,930	$401,566	0.48%	F
5BR	$2,239	$475,980	0.47%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 17331 (Hanover, PA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 17331 is set by HUD for the year 2026. The FMRs are as follows: - 0BR: $980 - 1BR: $1110 - 2BR: $1390 (which represents 21.0% of the median household income) - 3BR: $1870 - 4BR: $1940 To understand how these FMRs compare to actual rents, we need to consider the price-to-FMR ratio. For a 2BR unit, the Zillow median price is $224,912, which translates into a monthly rent of approximately $1,350 based on typical rental yields. However, the actual median rent for a 2BR unit is $1,390, which is slightly higher than the Zillow estimate. This indicates that the actual rents in the area are close to the FMRs but slightly above them. Given that the FMRs are set to ensure affordability for low-income households, the slight discrepancy between the FMR and actual rents can create constraints for voucher holders. They might struggle to find units within their budget, especially if landlords are charging above the FMR rates. The 2BR unit, which is a common size for families, costs $1,390 per month, representing 21.0% of the median household income. This means that even without a voucher, renters would be spending a significant portion of their income on housing. #### Affordability & Renter Profile ZIP code 17331 has a population of 56,443, with 23.6% of residents being renters. The occupancy rate stands at 95.3%, indicating a relatively tight rental market. With a median household income of $79,488, the majority of residents are likely to be employed in local industries such as manufacturing, healthcare, and retail. The high occupancy rate suggests that there is a strong demand for rental properties, making it a competitive market. However, the fact that only 23.6% of the population are renters implies that the majority of residents own their homes. This could mean that the rental market is smaller and more specialized compared to areas with a higher percentage of renters. Given the median income and the FMRs, the typical renter profile in Hanover would be a family earning around $79,488 annually. A 2BR unit at $1,390 per month would represent a substantial portion of their income, making affordability a key concern. The 21.0% of median income spent on a 2BR unit underscores the financial strain many renters face, particularly those relying on Section 8 vouchers. #### Investor Angle From an investor perspective, the ZIP code 17331 presents a mixed picture. The FMRs provide a baseline for what tenants can afford, but the actual rents suggest that landlords can charge slightly above these rates. The price-to-FMR ratio of 13.5x for a 2BR unit indicates that the purchase price of a property is significantly higher than the rent it generates. This ratio is calculated by dividing the median home value ($224,912) by the median rent ($16,680 per year), resulting in a multiplier of 13.5. In terms of cash flow, the FMRs are not sufficient to cover the mortgage payments on a property purchased at the median price. Assuming a 30-year fixed-rate mortgage with an interest rate of 5%, the monthly payment on a $224,912 property would be approximately $1,200. This leaves a small margin for expenses like maintenance, insurance, and property taxes, which can easily exceed the difference between the mortgage payment and the FMR rent. The investment grade for this ZIP code would be considered moderate to low due to the high price-to-rent ratio. While the demand for rental properties is strong, the financial returns are limited by the relatively low FMRs compared to the high purchase prices. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-rent ratio, investors should focus on smaller units like 0BR and 1BR apartments. These units have lower FMRs but can still command competitive rents. For example, a 1BR unit with an FMR of $1,110 might actually rent for $1,150 or more, providing better cash flow potential. 2. **Consider Multi-family Properties**: Single-family homes may not offer the best return on investment due to the high purchase prices. Instead, multi-family properties can spread the cost over multiple units, potentially improving overall cash flow. Investors should look for multi-family buildings where they can charge slightly above the FMR while still attracting voucher holders. 3. **Target Affordable Housing Projects**: Since the median income is relatively high, there is a segment of the population that can afford to pay more than the FMR. Investors could target affordable housing projects that cater to middle-income families, offering units at a premium but still below market rates. This approach can help balance the financial constraints while still serving the community. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 17331 would be to **skip** purchasing single-family homes at the median price. The high price-to-rent ratio and the limited cash flow make it challenging to generate a positive return. Instead, investors should consider **hold** strategies for existing multi-family properties or explore **buy** opportunities in smaller units or affordable housing projects where they can leverage slightly higher rents while still being accessible to voucher holders. The bottom line is that while Hanover has a strong rental market, the financial dynamics make it less attractive for investors solely focused on Section 8 vouchers. Diversifying into other types of rental properties or targeting middle-income families might yield better results.

Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.