Section 8 Fair Market Rent (FMR) for ZIP 18059 - 2027

FY 2027 Fair Market Rent Rates

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

Housing Authorities Serving ZIP 18059

• Allentown Housing Authority (Allentown, PA) - 1,839 Section 8 vouchers
• Lehigh County Housing Authority (Emmaus, PA) - 1,700 Section 8 vouchers

A decision tree for whether to invest in ZIP code 18059 for Section 8 properties starts with three key questions. The Fair Market Rent (FMR) for ZIP 18059 in fiscal year 2024 is set at $1350. This figure is crucial for evaluating the viability of a $485,229 property under the Section 8 program.

Question 1: Does the FMR of $1350 cover the debt service on a $485,229 property?

• No: If the FMR does not cover the debt service, investing in this ZIP code is not advisable. Debt service includes mortgage payments, property taxes, insurance, and maintenance costs. For a property priced at $485,229, these expenses must be fully covered by the FMR to ensure profitability and sustainability.

Question 2: Is the market rent above, at, or below the FMR of $1350?

• Market Rent Below FMR: If the local market rent is below the FMR, landlords can expect to receive higher rental income from Section 8 tenants compared to non-subsidized tenants. This scenario increases the attractiveness of the ZIP code for Section 8 investments.
• Market Rent Equal to FMR: When market rent matches the FMR, landlords will receive rental income that exactly covers the FMR, making it a neutral situation. However, the stability of rental income from Section 8 tenants might still make this ZIP code appealing.
• Market Rent Above FMR: If the market rent exceeds the FMR, landlords might find themselves receiving less income from Section 8 tenants than they could from market-rate tenants. This situation makes the ZIP code less attractive for Section 8 investments.

Question 3: Do the 6.5% of renters and the number of days on the market (DOM) indicate sufficient demand?

• It Depends: With 6.5% of the population renting, there is a baseline level of demand. However, the exact number of days on the market is needed to determine if this demand is strong enough. A low DOM suggests quick turnover and high demand, while a high DOM indicates the opposite. Without the specific DOM data, it's impossible to definitively conclude the investment potential.

In summary, ZIP 18059 is only viable for Section 8 investments if the FMR sufficiently covers the debt service and if the market rent is below or equal to the FMR. The 6.5% rental rate alone is insufficient to determine demand without knowing the DOM. These factors provide a clear framework for deciding whether to invest in this ZIP code.

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.