Section 8 Fair Market Rent (FMR) for ZIP 21222 - 2027

Investment Score for ZIP 21222

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	$1,300
1 Bedroom	$1,380
2 Bedrooms	$1,710
3 Bedrooms	$2,140
4 Bedrooms	$2,380
5 Bedrooms	$2,761
6 Bedrooms	$3,092
7 Bedrooms	$3,339
8 Bedrooms	$3,506

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
2BR	$1,710	$198,796	0.86%	C
3BR	$2,140	$237,943	0.9%	C
4BR	$2,380	$302,190	0.79%	D
5BR	$2,761	$351,865	0.78%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 21222 (Dundalk, MD) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 21222 is set by HUD for 2026 as follows: - 0BR: $1270 - 1BR: $1450 - 2BR: $1770 (which is 33.1% of the median household income of $64,141) - 3BR: $2280 - 4BR: $2550 To understand how these figures compare to actual rents, we need to consider the typical rental prices in Dundalk. The FMR for a 2BR unit is $1770, which is significantly lower than the Zillow median price for a 2BR home, which stands at $197,161. This suggests that the rental market is relatively expensive compared to the FMR, with a price-to-FMR ratio of 9.3x. This high ratio means that landlords who accept Section 8 vouchers will be constrained by the FMR limits, which could make it challenging to find properties that fit within these parameters. For instance, a landlord would only receive $1770 per month for a 2BR unit, even if the market rent might be much higher. This could lead to a situation where landlords are reluctant to participate in the Section 8 program due to the lower rental income compared to market rates. #### Affordability & Renter Profile ZIP code 21222 has a population of 59,407, with 35.1% of residents being renters. The occupancy rate is 93.9%, indicating a fairly tight rental market. Given that the median household income is $64,141, the 2BR FMR of $1770 represents about 33.1% of the median income. This suggests that while the FMR is affordable relative to the median income, it still places a significant financial burden on households, especially those relying on Section 8 vouchers. The high occupancy rate and the substantial percentage of renters indicate a strong demand for rental housing in Dundalk. However, the high price-to-FMR ratio also implies that there is a limited supply of units that fall within the FMR range. This tight market could result in competition among voucher holders for available units, potentially leading to longer wait times and fewer options. #### Investor Angle From an investor perspective, the ZIP code 21222 presents a mixed picture. The FMR for a 2BR unit is $1770, but the actual market rent is likely much higher given the price-to-FMR ratio of 9.3x. If an investor is considering purchasing a property to rent out under the Section 8 program, they must be aware that the rental income will be capped at the FMR levels. To determine whether this ZIP code is cash-flow positive at FMR, we need to consider the costs associated with owning and maintaining a rental property. Assuming a mortgage payment of around $1000 per month (based on average mortgage rates and the median home price), property taxes of approximately $200 per month, and maintenance costs of around $100 per month, the total monthly expenses would be around $1300. With a 2BR FMR of $1770, the net cash flow would be $470 per month, which is positive but relatively modest. Given the high price-to-FMR ratio and the tight rental market, the investment grade for this ZIP code is moderate. While there is demand for rental housing, the limited number of units that fall within the FMR range could make it difficult to find profitable opportunities. Additionally, the potential for higher market rents means that landlords may prefer to rent to non-voucher tenants, further limiting the pool of available Section 8 units. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units such as 0BR and 1BR apartments. These units have lower FMRs ($1270 and $1450 respectively) and are more likely to be rented at or below the FMR. This could provide a better cash flow position compared to larger units. 2. **Consider Off-Market Properties**: Investors should look for off-market properties that may be undervalued or not yet listed for rent. These properties could potentially be purchased and renovated to meet the FMR requirements, providing a more attractive investment opportunity. 3. **Engage with Local Housing Authorities**: Building relationships with local housing authorities can help investors stay informed about upcoming voucher allocations and tenant needs. This can provide a competitive advantage in securing Section 8 tenants and managing the property effectively. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 21222 is to **Hold**. The high price-to-FMR ratio and tight rental market make it challenging to find profitable opportunities. However, focusing on smaller units and engaging with local housing authorities can help mitigate some of these challenges. Overall, the investment potential is moderate, and investors should carefully evaluate their options before making any purchases.

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.