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 | $1,300 |
| 1 Bedroom | $1,410 |
| 2 Bedrooms | $1,680 |
| 3 Bedrooms | $2,000 |
| 4 Bedrooms | $2,210 |
| 5 Bedrooms | $2,564 |
| 6 Bedrooms | $2,872 |
| 7 Bedrooms | $3,102 |
| 8 Bedrooms | $3,257 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,680 | $265,580 | 0.63% | D |
| 3BR | $2,000 | $294,075 | 0.68% | D |
| 4BR | $2,210 | $476,181 | 0.46% | F |
| 5BR | $2,564 | $726,125 | 0.35% | F |
U.S. Census Bureau data (2024)
The analysis of Section 8 properties in ZIP code 19119, located in Philadelphia, 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 $1,550, while the Zillow Rent Index (ZORI) indicates that the market rent stands at $1,681. This results in a difference of $131, or approximately 8.4%, where landlords can charge above the FMR but must accept lower rates for Section 8 tenants.
In the context of Philadelphia, where 37.2% of residents are renters, the median home value is $366,425 and the median income is $92,651, it's essential to understand the implications of this gap. When the FMR is less than the market rent, as is the case here, landlords who choose to participate in the Section 8 program agree to lease their units at a rate below the open-market price. This means they are effectively subsidizing the housing costs for low-income families, which can lead to reduced cash flow compared to renting to non-voucher tenants.
The cost of housing voucher tenants below open-market rates is a key consideration for landlords and small-portfolio investors. In ZIP 19119, accepting a tenant with a Section 8 voucher means you will receive $1,550 per month, instead of the potential market rent of $1,681. This reduction in monthly rental income directly impacts the yield on investment properties. However, participating in the Section 8 program also comes with benefits such as guaranteed payment from the government if the tenant falls behind, and a steady stream of qualified tenants.
To summarize, the gap between the FMR and market rent in ZIP 19119 is $131, representing an 8.4% difference. Landlords should be aware that this gap means they will earn less per unit on average when renting to Section 8 tenants, which could affect their overall investment strategy and yield expectations. Given the economic conditions in Philadelphia, this decision should be made carefully, weighing the financial impact against the stability and support provided by the Section 8 program.
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.