Location: Philadelphia-Camden-Wilmington, PA | Metro: Philadelphia-Camden-Wilmington, PA-NJ-DE-MD 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 | $1,680 |
| 1 Bedroom | $1,820 |
| 2 Bedrooms | $2,170 |
| 3 Bedrooms | $2,590 |
| 4 Bedrooms | $2,850 |
| 5 Bedrooms | $3,306 |
| 6 Bedrooms | $3,703 |
| 7 Bedrooms | $3,999 |
| 8 Bedrooms | $4,199 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,170 | $352,184 | 0.62% | D |
| 3BR | $2,590 | $430,474 | 0.6% | D |
| 4BR | $2,850 | $543,765 | 0.52% | F |
| 5BR | $3,306 | $603,289 | 0.55% | F |
U.S. Census Bureau data (2024)
The analysis for the Section 8 program in ZIP code 19040, which encompasses parts of Hatboro, 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 $1890, while the Zillow Observed Rent Index (ZORI) indicates that the average market rent is $1616. This means that the FMR is $274 higher than the market rent, representing an increase of approximately 17%.
This gap suggests that landlords who participate in the Section 8 program can expect to receive a rental rate that is above the current market rate, making it an attractive yield play. The higher FMR compensates landlords for the administrative burdens associated with voucher tenants and ensures a stable income stream. Given that only 28.2% of residents in Hatboro are renters, landlords can benefit from the additional demand generated by voucher holders. Additionally, with a median home value of $441,247 and a median income of $114,293, the area has a relatively high standard of living, which further supports the willingness of residents to pay higher rents through vouchers.
However, the cost of housing voucher tenants below open-market rates must be considered. While the FMR provides a higher rent than the market rate, the overall expenses of maintaining properties and managing Section 8 tenants can be substantial. Landlords should account for these costs when deciding whether to participate in the program. The higher FMR also incentivizes landlords to improve their properties to meet the eligibility criteria for Section 8, thereby enhancing the quality of the housing stock in Hatboro.
In summary, the $274 difference between the FMR and the market rent in ZIP 19040 represents a 17% premium for landlords who choose to accept Section 8 vouchers. This makes the area a favorable investment for those seeking steady returns above the local market rates. Despite the potential for increased operational costs, the benefits of participating in the Section 8 program, especially in a community with a high median home value and income, outweigh the drawbacks.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.