Location: Scranton--Wilkes-Barre, PA | Metro: Scranton--Wilkes-Barre, PA MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $950 |
| 1 Bedroom | $1,110 |
| 2 Bedrooms | $1,370 |
| 3 Bedrooms | $1,790 |
| 4 Bedrooms | $1,970 |
| 5 Bedrooms | $2,285 |
| 6 Bedrooms | $2,559 |
| 7 Bedrooms | $2,764 |
| 8 Bedrooms | $2,902 |
The analysis of the Section 8 cap-rate scenario for ZIP code 18627 reveals some key insights into the potential returns for landlords and small-portfolio investors. The Federal Market Rent (FMR) for a 2-bedroom unit in this area, based on FY 2026 metro data, is set at an annualized rate of $1,260. However, the current market rent for the same type of unit is not available, indicating a lack of recent data points.
To calculate the implied gross yield, we must first understand that the cap rate is derived from dividing the net operating income (NOI) by the property value. Since the median home value for ZIP 18627 is not specified, we cannot provide an exact cap rate figure. Instead, we can discuss the gross yield implications of the FMR versus the missing market rent data.
In the case of the FMR at $1,260 annually, the gross yield would be significantly lower compared to typical market yields, especially considering the high costs associated with maintaining rental properties. This makes it less attractive for landlords who might seek higher returns from market rents.
Given the lack of data on market rent, median home value, renter density, and days on market (DOM), it's challenging to provide a precise comparison between the FMR and market-driven gross yields. However, it's safe to say that actual market rents would likely exceed the FMR, offering a more favorable gross yield for landlords.
The absence of specific renter density and DOM figures further complicates the analysis. Typically, higher renter density and shorter DOM periods indicate a stronger rental market, which could support higher rents and better gross yields. Without these figures, we can only speculate that the real-world gross yield would surpass the FMR-based yield due to the inherent limitations of government-set rates.
Landlords and small-portfolio investors should focus on obtaining the most up-to-date market rent data for ZIP 18627 to make informed decisions about potential investments and the attractiveness of the Section 8 program in this area. The FMR provides a baseline, but the true potential lies in understanding the local rental market dynamics.
Data Sources: FMR data from HUD (2027).
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.