Location: Sussex County, DE | Metro: Sussex County, DE
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 | $960 |
| 1 Bedroom | $960 |
| 2 Bedrooms | $1,260 |
| 3 Bedrooms | $1,590 |
| 4 Bedrooms | $1,960 |
| 5 Bedrooms | $2,274 |
| 6 Bedrooms | $2,547 |
| 7 Bedrooms | $2,751 |
| 8 Bedrooms | $2,889 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,260 | $223,220 | 0.56% | F |
| 3BR | $1,590 | $320,443 | 0.5% | F |
| 4BR | $1,960 | $373,116 | 0.53% | F |
U.S. Census Bureau data (2024)
A skeptical investor considering the ZIP code 19956 (Laurel, DE) might have several concerns regarding the feasibility of investing in properties that participate in the Section 8 program. Let's address these concerns head-on using the available data.
Objection 1: Will FMR $1010 (zip FY 2024) cover the mortgage on a $305,125 home?
The Fair Market Rent (FMR) for ZIP 19956 is set at $1010 per month for fiscal year 2024. To determine if this amount can cover the mortgage on a home priced at $305,125, we must calculate the potential monthly mortgage payment. Assuming a typical interest rate of around 4.5% and a 30-year fixed-rate mortgage, the monthly principal and interest payment would be approximately $1,500. This calculation does not include property taxes, insurance, and maintenance costs, which would further increase the total monthly expense. Therefore, the FMR of $1010 will not fully cover the mortgage on a $305,125 home. However, it's important to note that the FMR is intended to cover only a portion of the rent, with the remainder paid by the tenant.
Objection 2: Is there enough renter demand at 32.4%?
The rental vacancy rate for ZIP 19956 stands at 32.4%. While this figure is higher than what some investors might prefer, it does indicate a significant number of renters looking for housing. A high vacancy rate suggests that there is competition among landlords, which could drive down rents. However, it also means that there are opportunities to attract tenants by offering well-maintained and affordable homes. The data does not provide specifics on the number of Section 8 eligible tenants in Laurel, but given the overall rental demand, it is reasonable to assume that there is a pool of potential Section 8 tenants. It's advisable to conduct further research into local rental trends and the availability of Section 8 participants.
Objection 3: Will vouchers keep pace with $1,041 market rents?
The average market rent for ZIP 19956 is $1,041 per month. With the FMR set at $1010, there is a slight gap between the two figures. Vouchers are adjusted annually based on changes in the FMR, so they should theoretically keep pace with market rents. However, the data does not provide information on how quickly voucher amounts are adjusted or if they consistently match the FMR. In practice, landlords often face delays in receiving updated voucher amounts, which can result in short-term financial pressures. Despite this, the FMR closely aligns with the market rent, indicating that the majority of landlords participating in the Section 8 program should be able to manage their expenses without significant loss.
In conclusion, while there are valid concerns about the financial viability of investing in Section 8 properties in ZIP 19956, the data suggests that despite the challenges, there are opportunities for landlords who are willing to navigate the complexities of the program. The key lies in understanding local market dynamics and being prepared for the administrative aspects of voucher management.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.