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 | $1,930 |
| 1 Bedroom | $2,060 |
| 2 Bedrooms | $2,540 |
| 3 Bedrooms | $3,180 |
| 4 Bedrooms | $3,530 |
| 5 Bedrooms | $4,095 |
| 6 Bedrooms | $4,586 |
| 7 Bedrooms | $4,953 |
| 8 Bedrooms | $5,201 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 4BR | $3,530 | $1,055,943 | 0.33% | F |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 21794 provides a clear picture of the potential returns for landlords and small-portfolio investors. Based on the Fair Market Rent (FMR) for a two-bedroom apartment, which is set at $2480 annually for fiscal year 2024, the implied gross yield can be calculated. Given the median home value in the area is $1,039,228, the annualized FMR represents a gross yield of approximately 0.24%. This calculation is derived from dividing the annual rent by the property value.
In contrast, the market rent for the area is listed as N/A, indicating that there is insufficient data to provide a definitive figure. However, it's important to consider the context of the local rental market when evaluating the potential for higher yields through market rents. The low density of renters in the area, estimated at 0.5%, suggests that the demand for rental properties is relatively limited. Additionally, the N/A-day Days on Market (DOM) indicates that there is no recent data on how quickly rental units are being leased, which could impact the overall occupancy rates and thus the effective rental income.
The 0.24% gross yield based on the Section 8 FMR is the most reliable figure given the available data. While market rents might offer higher yields, the lack of specific figures and the low renter density make it difficult to accurately predict these returns. Landlords and investors should focus on the guaranteed income from the Section 8 program, which, while providing a lower gross yield, offers stability and reduced risk compared to the uncertainties associated with market rents.
To summarize, the gross yield from Section 8 rents in ZIP 21794 is approximately 0.24%, based on the annual FMR of $2480 for a two-bedroom unit. This yield is more realistic given the limited rental market data and low renter density in the area. Investors should weigh the benefits of guaranteed income against the potential for higher market rents when making investment decisions in this ZIP code.
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.