Location: Washington-Arlington-Alexandria, DC | Metro: Washington-Arlington-Alexandria, DC-VA-MD HUD Metro FMR Area
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 | $2,140 |
| 1 Bedroom | $2,230 |
| 2 Bedrooms | $2,470 |
| 3 Bedrooms | $3,150 |
| 4 Bedrooms | $3,710 |
| 5 Bedrooms | $4,304 |
| 6 Bedrooms | $4,820 |
| 7 Bedrooms | $5,206 |
| 8 Bedrooms | $5,466 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 4BR | $3,710 | $882,823 | 0.42% | F |
U.S. Census Bureau data (2024)
A skeptical investor looking at ZIP code 20861 might raise several valid concerns regarding the feasibility of investing in the area, particularly when considering the Federal Market Rent (FMR) and the rental market dynamics.
The first objection is whether the FMR of $2180 will adequately cover the mortgage on a home valued at $981,379. This concern stems from the need to ensure that rental income can sustain the financial burden of property ownership. To address this, let's break down the numbers. A typical mortgage payment for a home priced at $981,379, assuming a 20% down payment and a 30-year fixed-rate mortgage at an average interest rate of 5%, would be approximately $4,600 per month. Clearly, the FMR of $2180 falls short of covering this mortgage payment. Therefore, investors relying solely on FMR rates to set their rents will likely find it challenging to meet their mortgage obligations without additional income sources or higher rent rates.
Another point of contention is the low percentage of renter demand at 1.5%. This figure suggests that only a small fraction of the population in ZIP 20861 is actively seeking rental properties. However, it's important to note that this metric does not provide a complete picture of the rental market's health. While the demand percentage is indeed low, the actual number of renters and the vacancy rate are critical factors that could influence the ease of finding tenants. Unfortunately, the data provided does not offer these specifics, so we cannot definitively assess the impact of this low demand percentage on the ability to fill units.
Lastly, the question arises whether voucher holders will keep pace with the market rents, especially given that the data does not specify the current market rent levels in ZIP 20861. The FMR is designed to reflect a reasonable estimate of fair market rents for the area, but it is not always aligned with the actual market rents. If the market rents exceed the FMR, landlords who rely on voucher programs might face challenges in attracting tenants who can only pay up to the FMR rate. Conversely, if the FMR is close to the actual market rents, voucher programs can remain a viable source of steady rental income. Without specific market rent figures, it's impossible to make a conclusive statement on this matter.
In summary, while ZIP 20861 presents some challenges in terms of rental income coverage and the alignment of voucher payments with market rents, the true viability of investment depends on additional factors such as the actual number of renters, vacancy rates, and precise market rent levels. These considerations are necessary to form a comprehensive view of the investment potential in this area.
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.