Location: Philadelphia-Camden-Wilmington, PA | Metro: Philadelphia-Camden-Wilmington, PA-NJ-DE-MD MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,320 |
| 1 Bedroom | $1,430 |
| 2 Bedrooms | $1,710 |
| 3 Bedrooms | $2,040 |
| 4 Bedrooms | $2,250 |
| 5 Bedrooms | $2,610 |
| 6 Bedrooms | $2,923 |
| 7 Bedrooms | $3,157 |
| 8 Bedrooms | $3,315 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 19316 provides a clear picture of potential investment returns, especially for landlords and small-portfolio investors interested in the area. The Fair Market Rent (FMR) for a two-bedroom apartment in this ZIP code for fiscal year 2024 is set at $1600 per month. This annualizes to $19,200 annually. However, the median home value in the area is not available, making it challenging to derive a precise cap rate without additional information.
To calculate the cap rate, we need to know the net operating income (NOI) and the property's value. Since the median home value is not available, we can only provide an implied gross yield based on the FMR. Assuming a typical mortgage payment, taxes, insurance, and maintenance costs, the implied gross yield from the FMR would be significantly lower than what investors might expect from other investments. For example, if the total monthly expenses were around $1200, the NOI would be $400, leading to an annual NOI of $4,800. With the FMR annual rent of $19,200, the gross yield would be approximately 25%. This calculation is purely illustrative, as actual expenses can vary widely.
The lack of market rent data means that comparing the FMR scenario to a market rent scenario is not possible with the current information. However, given the 0.0% renter density in ZIP 19316, it suggests that there is little to no demand for rental properties in this area. This makes the FMR scenario less realistic for most investors, as finding tenants willing to pay the FMR might be difficult. Additionally, the days-on-market (DOM) figure being not available indicates either a very stable market where homes rarely change hands, or an inactive market. In either case, it complicates the analysis of potential rental income versus property value.
In conclusion, while the FMR offers a fixed rental income, the low renter density and uncertain market conditions in ZIP 19316 suggest that relying solely on FMR may not be the best strategy for maximizing returns. Investors should consider these factors and possibly seek out areas with higher tenant demand when evaluating potential investments.
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.