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 | $1,720 |
| 1 Bedroom | $1,870 |
| 2 Bedrooms | $2,230 |
| 3 Bedrooms | $2,660 |
| 4 Bedrooms | $2,930 |
| 5 Bedrooms | $3,399 |
| 6 Bedrooms | $3,807 |
| 7 Bedrooms | $4,112 |
| 8 Bedrooms | $4,318 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,870 | $211,159 | 0.89% | C |
| 2BR | $2,230 | $313,675 | 0.71% | D |
| 3BR | $2,660 | $480,523 | 0.55% | F |
| 4BR | $2,930 | $794,081 | 0.37% | F |
| 5BR | $3,399 | $865,950 | 0.39% | F |
U.S. Census Bureau data (2024)
The economics of Section 8 in ZIP code 19454, which encompasses North Wales, PA, in Montgomery County, are straightforward. The SAFMR (Small Area Fair Market Rent) for a two-bedroom apartment in this specific ZIP code for FY 2024 is set at $2000. This figure represents the maximum amount the government will pay for a rental unit in this area under the Section 8 Housing Choice Voucher program.
However, the local market rent, measured by ZORI (Zillow Observed Rent Index), is slightly lower at $1,899. This means that landlords who participate in the Section 8 program can expect their reimbursement to be capped at the SAFMR rate, regardless of the actual market conditions.
A voucher payment consists of two parts: the government subsidy and the tenant's contribution. The tenant is typically required to pay 30% of their adjusted income towards rent. For example, if a tenant has an adjusted income of $1,500 per month, they would contribute $450 towards the rent of a two-bedroom apartment. The government then covers the difference between the tenant’s contribution and the SAFMR rate, up to the limit of $2000.
In addition to the base rent, there are utility allowances. These allowances vary but generally cover the cost of electricity, gas, water, and sewer. For ZIP 19454, the utility allowance might be around $200-$300 per month, depending on the specifics of the property and its location.
To illustrate, let's assume a two-bedroom apartment in ZIP 19454 is rented at the ZORI price of $1,899. If the tenant contributes $450 based on their income, the government would subsidize the remaining $1,449 ($1,899 - $450). Adding a utility allowance of $250 brings the total monthly reimbursement to $1,700 ($1,449 + $250).
This results in a surplus for the landlord, as the total reimbursement exceeds the ZORI price. In this case, the surplus is $1,700 - $1,899 = -$199, indicating that the landlord would actually receive more than the market rent, creating a positive cash flow of $101 above the ZORI. However, if the landlord rents the property at the SAFMR rate of $2000, the surplus would be $250 ($2000 - $1,750).
Landlords should note that while participating in the Section 8 program can provide a steady stream of income, it also comes with additional administrative tasks and potential restrictions on tenant selection. The financial analysis shows that renting at or below the ZORI can yield a surplus, making it a viable option for landlords in ZIP 19454.
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.