Location: Baltimore-Columbia-Towson, MD | Metro: Baltimore-Columbia-Towson, MD MSA
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 | $1,850 |
| 1 Bedroom | $1,970 |
| 2 Bedrooms | $2,430 |
| 3 Bedrooms | $3,040 |
| 4 Bedrooms | $3,380 |
| 5 Bedrooms | $3,921 |
| 6 Bedrooms | $4,392 |
| 7 Bedrooms | $4,743 |
| 8 Bedrooms | $4,980 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,430 | $392,280 | 0.62% | D |
| 3BR | $3,040 | $454,113 | 0.67% | D |
| 4BR | $3,380 | $608,582 | 0.56% | F |
| 5BR | $3,921 | $745,509 | 0.53% | F |
U.S. Census Bureau data (2024)
To determine if a landlord should invest in ZIP 21144 (Severn, MD) for Section 8 properties, follow this decision tree:
1) Does FMR $2360 (zip FY 2024) clear debt service on a $520,441 property?
No. The Fair Market Rent (FMR) of $2360 does not cover the typical debt service on a property valued at $520,441. Debt service includes mortgage payments, property taxes, insurance, and maintenance costs. At this price point, the rental income would be insufficient to meet these obligations without additional subsidies or lower-cost financing options.
2) Is market rent $2,120 (ZORI) above, at, or below FMR?
Below. The market rent, as indicated by the Zillow Rent Index (ZORI), is $2,120, which is below the FMR of $2360. This suggests that while the market rent is slightly lower, it is still relatively close to the FMR. However, this does not directly impact the viability of a Section 8 investment since the FMR is the benchmark for rental assistance payments.
3) Are 19.7% renters + 13-day DOM enough demand?
It depends. In ZIP 21144, 19.7% of the population are renters, and the average days on market (DOM) for rentals is 13 days. While the DOM indicates strong demand for available rentals, the percentage of renters is relatively low. This means that the overall pool of potential tenants, including those eligible for Section 8, might be limited. For a landlord considering a Section 8 property, they must weigh the strength of demand against the smaller pool of potential tenants.
If the landlord's primary goal is to ensure that their debt service is covered by rental income, then the answer is a clear No. The FMR of $2360 does not sufficiently cover the costs associated with a property priced at $520,441. However, if the landlord is willing to accept a lower net income and has access to favorable financing terms, they could proceed with caution. Additionally, if the landlord is primarily interested in occupancy rates and the ability to quickly fill vacancies, the strong demand indicated by the 13-day DOM supports a Yes. But they must consider the relatively low percentage of renters in the area.
In conclusion, the decision to purchase a Section 8 property in ZIP 21144 hinges on the landlord's financial strategy and risk tolerance. They need to balance the shortfall in covering debt service against the robust local rental market and the potential for quick occupancy.
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.