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 | $1,210 |
| 1 Bedroom | $1,320 |
| 2 Bedrooms | $1,630 |
| 3 Bedrooms | $2,080 |
| 4 Bedrooms | $2,140 |
| 5 Bedrooms | $2,482 |
| 6 Bedrooms | $2,780 |
| 7 Bedrooms | $3,002 |
| 8 Bedrooms | $3,152 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,630 | $316,202 | 0.52% | F |
| 3BR | $2,080 | $398,390 | 0.52% | F |
| 4BR | $2,140 | $551,907 | 0.39% | F |
U.S. Census Bureau data (2024)
The economics of Section 8 in ZIP code 17563, which covers Peach Bottom, Pennsylvania in Lancaster County, can be broken down clearly. For a two-bedroom apartment, the SAFMR (Small Area Fair Market Rent) for FY 2024 is set at $1,410. This figure is specific to this ZIP code, reflecting localized housing costs rather than broader county or metropolitan averages.
Local market rents, according to the Census ACS data, stand at $1,374 for a similar unit. However, it's important to understand that the SAFMR sets the ceiling for rental payments under the Section 8 program. Landlords cannot charge more than this amount for a two-bedroom unit if they wish to participate in the program.
A landlord participating in Section 8 will receive a combination of payments from the Housing Authority and the tenant. The tenant is responsible for paying 30% of their adjusted income towards rent. If we assume an average adjusted income of $1,000 for simplicity, the tenant would pay $300. The Housing Authority then covers the difference up to the SAFMR of $1,410. In this case, the Housing Authority would pay $1,110, ensuring the total rent does not exceed the SAFMR.
In addition to the base rent, there are utility allowances that vary but are typically around $300 per month. These allowances cover electricity, water, and gas, and are paid directly to the landlord by the Housing Authority. Therefore, the total reimbursement a landlord might expect for a two-bedroom unit in ZIP 17563 could be calculated as follows:
Total reimbursement = Base rent payment + Utility allowance
Using the numbers above, the total reimbursement would be $1,410 ($1,110 from the Housing Authority plus the tenant's $300 contribution) plus the utility allowance of $300, totaling $1,710.
However, since the local market rent is lower at $1,374, landlords should note that the actual reimbursement gap or surplus is minimal. The SAFMR being slightly higher than the market rent means landlords participating in Section 8 in ZIP 17563 can expect to receive close to the market value, with a slight surplus of $36 per month before accounting for utilities. This makes Section 8 a stable option for landlords in this area, offering consistent income without significant loss compared to market rates.
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.