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 | $1,990 |
| 1 Bedroom | $2,080 |
| 2 Bedrooms | $2,300 |
| 3 Bedrooms | $2,930 |
| 4 Bedrooms | $3,450 |
| 5 Bedrooms | $4,002 |
| 6 Bedrooms | $4,482 |
| 7 Bedrooms | $4,841 |
| 8 Bedrooms | $5,083 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,300 | $323,284 | 0.71% | D |
| 3BR | $2,930 | $419,290 | 0.7% | D |
| 4BR | $3,450 | $562,176 | 0.61% | D |
| 5BR | $4,002 | $641,565 | 0.62% | D |
U.S. Census Bureau data (2024)
The ZIP code 22405 is situated in the heart of Fredericksburg, Virginia, a city known for its blend of historic charm and modern amenities. With a total population of 36,890, this neighborhood is predominantly owner-occupied, as only 15.9% of residents are renters. The area boasts a high median household income of $128,259, indicating a relatively affluent community. This prosperity is reflected in the median home value of $473,657, which is significantly higher than the national average.
Turning to the rent economics, the Fair Market Rent (FMR) for ZIP 22405 in fiscal year 2024 is set at $1,610. In stark contrast, the market rent, as measured by the Zillow Observed Rental Index (ZORI), stands at $2,337. This discrepancy highlights the potential for landlords to capitalize on the higher market rents while still offering affordable housing options through the Section 8 program. The difference between the FMR and the ZORI suggests a robust rental market where properties can command premium rates above those subsidized by the government.
Given these conditions, ZIP 22405 might appeal to both hands-off voucher operators and hands-on value-add buyers. For hands-off operators, the presence of a stable and relatively high median income ensures a reliable pool of tenants who can manage the balance between voucher subsidies and any required tenant contribution towards rent. On the other hand, value-add buyers could find opportunities to renovate and reposition properties to attract higher-paying tenants, leveraging the strong local economy and the high median home values to justify increased rents. However, due to the significant gap between the FMR and market rents, hands-on investors would need to be particularly strategic about property management and tenant selection to maximize returns while adhering to the program's regulations.
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.