Location: Madison County, VA | Metro: Madison County, VA
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 | $910 |
| 1 Bedroom | $980 |
| 2 Bedrooms | $1,070 |
| 3 Bedrooms | $1,430 |
| 4 Bedrooms | $1,660 |
| 5 Bedrooms | $1,926 |
| 6 Bedrooms | $2,157 |
| 7 Bedrooms | $2,330 |
| 8 Bedrooms | $2,447 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,070 | $309,283 | 0.35% | F |
| 3BR | $1,430 | $425,381 | 0.34% | F |
| 4BR | $1,660 | $570,427 | 0.29% | F |
U.S. Census Bureau data (2024)
The analysis of the Section 8 program in ZIP code 22727, which encompasses Madison, VA, reveals a significant gap between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR stands at $930, while the Census ACS data indicates a market rent of $1,192. This results in a $262 difference, representing a 28.2% gap between the two figures.
The disparity suggests that landlords and small-portfolio investors who participate in the Section 8 program may be operating at a loss when compared to the open-market rental rates. Given the median home value of $412,742 and a median income of $84,857 in Madison, VA, it's evident that the local economy supports higher rental prices. However, the FMR set by the government is lower, making it challenging for property owners to cover their costs, including maintenance and mortgage payments, if they solely rely on the voucher program.
In Madison, where 27.7% of residents are renters, the lower FMR can impact the willingness of landlords to accept Section 8 vouchers. The cost of housing voucher tenants below open-market rates means that landlords must balance the benefits of guaranteed rent payments against the potential financial shortfall. This scenario makes the ZIP 22727 area less attractive for landlords looking to maximize their yields compared to those who can charge the full market rate of $1,192 per month.
To put this into perspective, if a landlord has a property that could command $1,192 in the open market but accepts a Section 8 tenant at the FMR rate of $930, they are foregoing nearly $3,144 annually per unit. This discrepancy is particularly relevant given the high median home value, indicating that property costs in the area are also elevated.
Therefore, for landlords and small-portfolio investors considering participation in the Section 8 program within ZIP 22727, it is crucial to factor in the 28.2% discount relative to market rents. While the program offers stability and a steady stream of income, the financial implications must be carefully weighed against the broader economic conditions of Madison, VA.
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.