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 | $1,800 |
| 1 Bedroom | $1,880 |
| 2 Bedrooms | $2,080 |
| 3 Bedrooms | $2,650 |
| 4 Bedrooms | $3,120 |
| 5 Bedrooms | $3,619 |
| 6 Bedrooms | $4,053 |
| 7 Bedrooms | $4,377 |
| 8 Bedrooms | $4,596 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $2,650 | $501,225 | 0.53% | F |
| 4BR | $3,120 | $633,589 | 0.49% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 21773 reveals interesting insights into the potential returns for landlords and small-portfolio investors. The Fair Market Rent (FMR) for a 2-bedroom unit in this area for FY 2024 is set at $1,660 per month. When annualized, this translates to an effective rental income of $19,920 annually. Given the median home value in the area is $554,261, the implied gross yield from the FMR would be approximately 3.6%. This is calculated by dividing the annual rental income by the property value.
In contrast, the market rent for a similar 2-bedroom unit stands at $1,731 per month according to Census ACS data. Annualizing this figure yields an annual rental income of $20,772. Using the same median home value, this scenario implies a gross yield of roughly 3.7%. Both these yields are quite modest and reflect the reality that Section 8 properties typically offer lower gross yields compared to market-rate rentals due to the capped rent levels.
The renter density in ZIP 21773 is 6.4%, indicating a relatively low demand for rental properties. However, the N/A-day Days on Market (DOM) suggests that the available data does not provide a clear indication of how quickly rental units are being leased. Despite this, it's reasonable to assume that the market rent scenario ($1,731 per month) is more reflective of what landlords can realistically expect in terms of rental income. While the FMR provides a guaranteed floor, the market rate offers a slightly higher ceiling, making it the more pragmatic choice for calculating expected returns.
To summarize, the gross yield based on FMR is 3.6%, whereas the gross yield based on market rent is 3.7%. Given the low renter density and lack of specific DOM data, investors should lean towards the market rent figure when assessing the viability of Section 8 properties in ZIP 21773. These yields are indicative of the conservative returns expected from such investments, underscoring the importance of thorough due diligence and understanding the local rental market dynamics.
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.