Location: York-Hanover, PA | Metro: York-Hanover, PA MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $900 |
| 1 Bedroom | $990 |
| 2 Bedrooms | $1,260 |
| 3 Bedrooms | $1,670 |
| 4 Bedrooms | $1,750 |
| 5 Bedrooms | $2,030 |
| 6 Bedrooms | $2,274 |
| 7 Bedrooms | $2,456 |
| 8 Bedrooms | $2,579 |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 17403 in York, PA, provides insight into the financial viability of properties in this area for landlords and small-portfolio investors. The Fair Market Rent (FMR) for a two-bedroom apartment in FY 2024 is set at $1170 per month, while the Zillow Observed Rent Index (ZORI) indicates a market rent of $1,281 per month for the same type of unit. To annualize these figures, we multiply them by 12, yielding an annualized FMR of $14,040 and an annualized market rent of $15,372.
The median home value in ZIP 17403 is $250,635. Using this figure, we can calculate the implied gross yield for both the FMR and market rent scenarios. For the FMR scenario, the gross yield is calculated as follows:
$14,040 / $250,635 = 0.0560 or 5.60%
For the market rent scenario, the gross yield is:
$15,372 / $250,635 = 0.0613 or 6.13%
Given that 36.2% of the population in ZIP 17403 are renters and the average days on market (DOM) for rental listings is 17 days, it is evident that there is a steady demand for rental properties in this area. However, the reality of the rental market often means that landlords must accept lower rents due to the availability of Section 8 vouchers. In this case, the gross yield based on the FMR is more realistic for landlords participating in the Section 8 program.
While the gross yield based on market rent is higher at 6.13%, the likelihood of consistently achieving this rent level with Section 8 tenants is low. The gross yield of 5.60% derived from the FMR reflects a more achievable income stream for landlords who are willing to participate in the Section 8 program. This yield is still competitive and can provide a stable investment opportunity for those looking to enter or expand their presence in the York, PA, rental market.
Data Sources: FMR data from HUD (2027). 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.