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 | $2,100 |
| 1 Bedroom | $2,190 |
| 2 Bedrooms | $2,420 |
| 3 Bedrooms | $3,080 |
| 4 Bedrooms | $3,630 |
| 5 Bedrooms | $4,211 |
| 6 Bedrooms | $4,716 |
| 7 Bedrooms | $5,093 |
| 8 Bedrooms | $5,348 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $2,190 | $216,809 | 1.01% | B |
| 2BR | $2,420 | $292,468 | 0.83% | C |
| 3BR | $3,080 | $428,278 | 0.72% | D |
| 4BR | $3,630 | $612,950 | 0.59% | F |
| 5BR | $4,211 | $910,865 | 0.46% | F |
U.S. Census Bureau data (2024)
Germantown (ZIP 20874) functions as a mature suburban node within Montgomery County, characterized by a blend of established residential neighborhoods and significant commercial activity. It is often defined by the presence of the Upcounty Regional Services Center and serves as a major employment hub, with organizations like Adventist HealthCare operating substantial facilities in the area. The town offers a mix of urban amenities and suburban density, making it a practical location for working families.
From an investment perspective, the data reveals a tight pricing environment. The HUD Fair Market Rent (FMR) for a 2-bedroom unit is $2,220, while current market rents (Zillow ZORI) sit at $2,029. This creates a negative gap of approximately $191 per month, meaning the voucher rate exceeds the market rate. The median home value is $418,192, with a specific 2-bedroom median sale price of $296,935. Properties are moving at a moderate pace, with a median days on market of 46 days.
With a median household income of $115,022 and a renter share of 33.6%, the tenant pool is generally stable, though the high incomes suggest many residents are homeowners rather than renters. For voucher holders, the area offers strong appeal due to access to well-regarded schools within the Montgomery County Public School system and robust transit links via the MARC train and RideOn bus services, which connect commuters to Washington, D.C. and biotech hubs along the I-270 corridor.
The Section 8 verdict for 20874 leans heavily toward stability and long-term appreciation rather than immediate, high-yield cash flow. While the voucher rate technically outperforms the market rent by $191, the high acquisition cost relative to the rent ceiling means yields will be compressed. Investors should target this area for lower tenant turnover and capital preservation, relying on the strength of the local economy and school district rather than aggressive rent bumps.
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.