Section 8 Fair Market Rent (FMR) for ZIP 20001 - 2027

Investment Score for ZIP 20001

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$2,970
1 Bedroom	$3,100
2 Bedrooms	$3,430
3 Bedrooms	$4,370
4 Bedrooms	$5,150
5 Bedrooms	$5,974
6 Bedrooms	$6,691
7 Bedrooms	$7,226
8 Bedrooms	$7,587

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$3,100	$424,059	0.73%	D
2BR	$3,430	$642,661	0.53%	F
3BR	$4,370	$812,063	0.54%	F
4BR	$5,150	$986,467	0.52%	F
5BR	$5,974	$1,149,382	0.52%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 20001 (Washington, DC) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 20001 in Washington, DC, is set by HUD for the year 2026. For a two-bedroom unit, the FMR is $3,140, which represents 27.3% of the median household income of $138,059. This indicates that the rent for a two-bedroom unit is relatively affordable compared to the income levels in the area. However, the actual median rent for a two-bedroom unit on Zillow is $649,905, which is significantly higher than the FMR. The price-to-FMR ratio for a two-bedroom unit is 17.2x, meaning that the actual rental prices are much higher than what is considered fair market rent. Given these figures, it is clear that there is a significant gap between the FMR and the actual rents. For Section 8 voucher holders, this means that they face severe constraints in finding housing that fits within their budget. The maximum allowable rent under the Section 8 program is capped at the FMR, making it difficult for voucher holders to secure units in this market without substantial subsidies. #### Affordability & Renter Profile ZIP code 20001 has a population of 44,616, with 66.6% of residents being renters. This high percentage of renters suggests a strong demand for rental properties in the area. The occupancy rate of 88.6% further supports the notion that the market is tight, with most available units being occupied. Despite the high median household income, the majority of residents are renters, indicating that homeownership may be out of reach for many due to the high cost of living and property values. The median household income of $138,059 is quite high, but the median rent for a two-bedroom unit at $649,905 is exceptionally steep. This implies that the typical renter in this ZIP code likely has a higher-than-average income to afford such high rents. The market is clearly oversubscribed by renters, but undersupplied with affordable units. The high price-to-FMR ratio suggests that the market is not only tight but also highly unaffordable for those relying solely on Section 8 vouchers. #### Investor Angle From an investor perspective, the ZIP code 20001 presents a challenging scenario when considering cash flow based on FMR. Given that the actual rents are 17.2 times higher than the FMR, it would be nearly impossible to find tenants who can pay the actual market rent using only a Section 8 voucher. However, if an investor were to consider renting to Section 8 voucher holders, the cash flow would be constrained by the FMR. For instance, a two-bedroom unit would generate a monthly rent of $3,140, which is a far cry from the actual market rent of $649,905. This makes the investment grade low for properties intended for Section 8 voucher holders, as the potential returns are limited by the government-set rent caps. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units such as studios or one-bedroom apartments. The FMR for a one-bedroom unit is $2,820, which is still a fraction of the actual market rent. This could potentially allow for better cash flow if the investor can negotiate a higher rent that is still within the voucher holder’s budget. 2. **Consider Mixed-Income Developments**: Investors might want to explore mixed-income developments where a portion of the units are rented to Section 8 voucher holders while other units are rented to higher-income individuals. This approach could balance the lower cash flow from Section 8 units with higher rents from non-voucher tenants. 3. **Seek Government Subsidies**: Engage with local government programs that offer additional subsidies or incentives for landlords who accept Section 8 vouchers. These programs can help offset the lower rent and improve overall cash flow. #### Bottom Line For investors focusing on Section 8 vouchers, ZIP code 20001 is not a favorable market due to the extremely high price-to-FMR ratio. The recommendation is to **skip** this ZIP code unless you can secure additional subsidies or are willing to operate in a niche market where you can leverage mixed-income developments. The tight market and high rents make it difficult for Section 8 voucher holders to find suitable housing, and thus, the potential for cash flow is severely limited.

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.