Location: Lancaster, PA | Metro: Lancaster, 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 | $1,070 |
| 1 Bedroom | $1,160 |
| 2 Bedrooms | $1,440 |
| 3 Bedrooms | $1,830 |
| 4 Bedrooms | $1,890 |
| 5 Bedrooms | $2,192 |
| 6 Bedrooms | $2,455 |
| 7 Bedrooms | $2,651 |
| 8 Bedrooms | $2,784 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,440 | $322,173 | 0.45% | F |
| 3BR | $1,830 | $386,353 | 0.47% | F |
| 4BR | $1,890 | $498,493 | 0.38% | F |
| 5BR | $2,192 | $810,001 | 0.27% | F |
U.S. Census Bureau data (2024)
The analysis for the Section 8 program in ZIP code 17557, which covers parts of New Holland, PA, reveals a significant gap between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR is set at $1350, while the Census ACS reports the market rent at $1,216. This means the FMR is $134 higher than the market rent, representing an increase of approximately 11.02%. In New Holland, where 32.2% of residents are renters, the median home value stands at $410,875, and the median household income is $82,491.
The higher FMR compared to the market rent makes properties in ZIP 17557 attractive for voucher tenants, turning this into a yield play for landlords and small-portfolio investors. The government's willingness to pay up to $1350 per month ensures a steady stream of rental income that exceeds the average market rate. This can be particularly beneficial in areas where there is a high percentage of renters, as it guarantees occupancy and reduces the risk of vacancy.
However, accepting Section 8 voucher tenants also comes with costs. Landlords must adhere to federal housing quality standards and may face delays in lease-up due to the administrative process involved. Additionally, the maintenance and management of these properties must be kept at a high standard to comply with HUD regulations, which can add to operational expenses.
In summary, the gap between the FMR and market rent in ZIP 17557 presents an opportunity for landlords to generate higher yields than what is typically available in the open market. Despite the associated costs, the guaranteed income from voucher tenants can be a valuable asset in a rental market where the median home value is $410,875 and the median income is $82,491.
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.