Section 8 Fair Market Rent (FMR) for ZIP 20171 - 2027

Investment Score for ZIP 20171

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	$2,530
1 Bedroom	$2,640
2 Bedrooms	$2,920
3 Bedrooms	$3,720
4 Bedrooms	$4,380
5 Bedrooms	$5,081
6 Bedrooms	$5,691
7 Bedrooms	$6,146
8 Bedrooms	$6,453

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	$2,640	$290,072	0.91%	C
2BR	$2,920	$467,510	0.62%	D
3BR	$3,720	$642,644	0.58%	F
4BR	$4,380	$955,824	0.46%	F
5BR	$5,081	$1,133,249	0.45%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 20171 (Herndon, VA) #### Section 8 Voucher Dynamics In ZIP code 20171, the Fair Market Rent (FMR) for a two-bedroom apartment is set at $2660 per month. This figure represents 18.6% of the median household income in the area, which stands at $171,372. However, it is important to note that the actual rent in the market far exceeds the FMR. The Zillow median price for a two-bedroom home is $472,065, which translates to a monthly rental cost of approximately $2310 based on typical mortgage-to-rent conversion rates. Given the significant gap between the FMR and the actual rental costs, voucher holders face considerable constraints. They must find landlords willing to accept a voucher that covers only $2660, which is less than the average market rate for similar units. This can be challenging, especially considering the high occupancy rate of 96.1%, indicating limited availability of rental properties. #### Affordability & Renter Profile The population of Herndon is 51,286, with 43.1% of residents being renters. The high median household income suggests that many residents are likely professionals or executives working in nearby metropolitan areas such as Washington D.C. Despite the relatively high income levels, the rent-to-income ratio remains a concern. For instance, the FMR for a two-bedroom unit is $2660, which is still a substantial portion of the average renter’s income. The tight market conditions, coupled with the high occupancy rate, indicate that there is a strong demand for rental housing, but the supply is constrained. This makes it difficult for lower-income renters to find affordable options, even with the assistance of Section 8 vouchers. #### Investor Angle From an investor perspective, the ZIP code 20171 presents a mixed picture. The price-to-FMR ratio is 14.8x, meaning that the median home value is significantly higher than the FMR for renting. To determine if this ZIP is cash-flow positive at FMR, we need to consider the potential rental income versus the mortgage payments. Assuming a typical mortgage-to-rent conversion rate of 1%, a home priced at $472,065 would generate a monthly rental income of about $4721. However, the FMR for a two-bedroom unit is only $2660, which is substantially lower. Therefore, relying solely on FMR would result in a negative cash flow for investors, as they would need to cover the remaining $2061 in mortgage payments out-of-pocket. Given these dynamics, the investment grade for this ZIP code is moderate to low for Section 8-focused investors. While there is a strong demand for rental housing, the high price-to-FMR ratio and the limited number of properties available at or below FMR make it challenging to achieve positive cash flow. #### Specific Actionable Insights 1. **Target Lower-Income Segments**: Investors should focus on developing or acquiring properties that cater specifically to lower-income segments. This could involve building or renovating smaller units like studios or one-bedroom apartments, which have lower FMRs ($2310 and $2390 respectively). These units are more likely to attract voucher holders and generate positive cash flow. 2. **Consider Location-Specific Strategies**: Given the high occupancy rate, investors might benefit from targeting areas within Herndon that have slightly lower occupancy rates or are experiencing growth. This could help in securing tenants more easily and potentially achieving better rental yields. 3. **Engage with Local Housing Authorities**: Building relationships with local housing authorities can provide insights into the number of available vouchers and the preferences of voucher holders. This can help in tailoring property offerings to meet the needs of this segment, thereby increasing the likelihood of tenancy. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 20171 is to **Skip**. The high price-to-FMR ratio and the limited number of properties available at or below FMR make it difficult to achieve positive cash flow. Additionally, the strong demand for rental housing and high occupancy rates suggest that finding tenants who qualify for Section 8 vouchers may be challenging. Investors looking to enter this market should carefully evaluate their strategies and consider alternative ZIP codes with more favorable conditions for Section 8 properties.

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.