Section 8 Fair Market Rent (FMR) for ZIP 19944 - 2027

FY 2027 Fair Market Rent Rates

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

In evaluating whether to purchase a property in ZIP code 19944 for Section 8 investment, follow this decision tree:

1) Debt Service Coverage Ratio (DSCR) Analysis:

• If Yes: The Fair Market Rent (FMR) of $1380 is sufficient to cover the debt service on a property valued at $1,090,174. This means that the rental income generated at the FMR level can support the mortgage payments.
• If No: The FMR of $1380 does not sufficiently cover the debt service on a property valued at $1,090,174. In this case, the investment would not be financially viable under Section 8 guidelines.

2) Market Rent vs. FMR Comparison:

• If Market Rent is Above FMR: The Census ACS reports a market rent of $1,393, which is above the FMR of $1380. This indicates that there is potential to earn more than the FMR, making the area attractive for Section 8 investment.
• If Market Rent is Equal to FMR: The market rent matches the FMR exactly at $1380. While this ensures that the property will be rented out at the FMR, it leaves little room for price adjustments if market conditions change.
• If Market Rent is Below FMR: The market rent is reported as $1,393, which is above the FMR of $1380. Therefore, this scenario does not apply, but if it did, it would suggest that the local rental market is weaker than the FMR, potentially leading to vacancy issues.

3) Demand Analysis:

• If Yes: With 8.1% of the population being renters and an unspecified number of days on the market (DOM), there is sufficient demand for rental properties in this area. However, the exact number of days on the market is needed to make a precise determination. Generally, a lower DOM indicates higher demand.
• If No: If the demand is insufficient, meaning either the percentage of renters is too low or the DOM is high, then the investment in ZIP 19944 may not be advisable due to potential difficulties in finding tenants.
• If It Depends: The 8.1% of renters suggests moderate demand, but without knowing the DOM, it's hard to make a definitive call. If the DOM is low, it implies strong demand; if high, weak demand. Additionally, consider the overall economic health of the area and competition levels.

Based on the provided data, the FMR is adequate to support the debt service on a property valued at $1,090,174. Market rent exceeds the FMR, indicating a healthy rental environment. However, the demand analysis is inconclusive without the DOM figure. A thorough review of the local real estate market and tenant demographics is recommended before making a final decision.

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.