Section 8 Fair Market Rent (FMR) for ZIP 23183 - 2027

FY 2027 Fair Market Rent Rates

The analysis for ZIP code 23183 in Virginia focuses on the potential for Section 8 housing, given the annualized Fair Market Rent (FMR) for a two-bedroom apartment set at $1310 for fiscal year 2024. However, the data indicates that the median home value and market rent for this area are currently unavailable. Additionally, the renter density percentage and the days on market (DOM) are also not specified, making it challenging to provide a comprehensive analysis.

To derive a rough cap-rate picture, we must first understand that the cap rate is calculated as the net operating income (NOI) divided by the property's value. The gross yield, which is a simpler metric, can be calculated as the annual rental income divided by the property's value. In the case of Section 8 properties, the annual rental income would be based on the FMR rather than market rents.

Given the FMR of $1310 per month, the annual rental income for a two-bedroom unit would be $15,720. Without a median home value, we cannot calculate an exact gross yield; however, we can infer that if the median home value were known, the gross yield would be lower than what one might expect from market rents due to the subsidized nature of Section 8 rents.

Since the market rent is listed as N/A, we cannot directly compare the gross yields between Section 8 and market rents. However, it's important to note that market rents typically exceed the FMR, leading to a higher gross yield for non-subsidized properties.

The lack of specific data points such as median home value, renter density, and DOM makes it difficult to determine which scenario is more realistic. Generally, areas with high renter density and low DOM indicate a strong rental market, which could favor market rents over Section 8 rents. Conversely, areas with lower renter density and higher DOM might find Section 8 rents more stable and reliable.

In conclusion, while the FMR provides a baseline for potential rental income in ZIP 23183, the absence of key data points limits our ability to make a precise comparison between Section 8 and market rents. Investors should seek additional local market data to better inform their decision-making process.

Data Sources: FMR data from HUD (2027).

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.