Section 8 Fair Market Rent (FMR) for ZIP 23185 - 2027

Investment Score for ZIP 23185

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,530
1 Bedroom	$1,550
2 Bedrooms	$1,740
3 Bedrooms	$2,400
4 Bedrooms	$2,830
5 Bedrooms	$3,283
6 Bedrooms	$3,677
7 Bedrooms	$3,971
8 Bedrooms	$4,170

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,550	$214,755	0.72%	D
2BR	$1,740	$270,119	0.64%	D
3BR	$2,400	$411,227	0.58%	F
4BR	$2,830	$582,155	0.49%	F
5BR	$3,283	$731,724	0.45%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 23185 (Williamsburg, VA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 23185 is set by HUD for 2026, with specific rates for different bedroom sizes. For a two-bedroom unit, the FMR is $1800 per month. This represents approximately 20.5% of the median household income of $105,431, indicating that it is relatively affordable for residents in this area. However, the actual rental market in Williamsburg is significantly higher than the FMR. The Zillow median price for a two-bedroom home is $267,443, which translates to a monthly rent of about $1240 based on typical mortgage payments. Given the high price-to-FMR ratio of 12.4x, it is clear that the actual rents far exceed the FMR. This creates significant constraints for voucher holders. The maximum allowable rent under the Section 8 program is capped at the FMR, meaning that tenants with vouchers would struggle to find units that fit within their budget. Landlords who accept Section 8 vouchers will have to adjust their rental prices to align with the FMR, which is likely below market rates. #### Affordability & Renter Profile Williamsburg has a population of 55,270, with 28.3% of households being renters. The occupancy rate is 88.0%, suggesting a fairly tight rental market where most available units are occupied. Given the median household income of $105,431, the majority of residents can afford to purchase homes rather than rent. However, the 28.3% of households that do rent are likely to be younger professionals, students, or those who prefer renting over buying. The high median home value and the low percentage of renters indicate that the market is competitive for those seeking rental properties. The gap between the FMR and the actual rental prices suggests that affordability is a challenge for many potential renters, especially those relying on Section 8 vouchers. The median income is high enough that most residents could afford to buy homes, but the rental market remains active due to lifestyle choices and preferences. #### Investor Angle From an investor perspective, the ZIP code 23185 presents a mixed picture. The FMR for a two-bedroom unit is $1800, while the actual median rent is much higher. To determine if this ZIP code is cash-flow positive at FMR, we need to consider the typical expenses associated with owning a rental property. These include mortgage payments, property taxes, insurance, maintenance, and other costs. Assuming a conservative estimate of $1240 in mortgage payments (based on the Zillow median price), plus $200 for property taxes, $100 for insurance, and $100 for maintenance, the total monthly expense would be around $1640. At the FMR of $1800, the net cash flow would be $160 per month, which is positive but slim. This indicates that the investment grade for properties accepting Section 8 vouchers is moderate, as the profit margins are narrow. However, the high actual rental prices suggest that there is significant demand for rental properties, even if they are not Section 8 compliant. Investors who can offer units at slightly above FMR but still below market rates might attract both voucher holders and non-voucher renters, creating a more robust cash flow scenario. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units such as one-bedroom apartments. The FMR for a one-bedroom unit is $1590, which is closer to the actual rental prices. This would allow for better cash flow and a higher likelihood of attracting tenants. 2. **Consider Mixed-Income Developments**: Developments that cater to both Section 8 voucher holders and market-rate renters could be more financially viable. By offering a mix of units at different price points, investors can balance the lower rents required by vouchers with higher rents from other tenants. 3. **Target Areas with Lower Property Values**: While the overall median home value is high, there may be pockets within the ZIP code where property values are lower. Investing in these areas could reduce the initial capital outlay and improve cash flow when setting rents at FMR levels. #### Bottom Line For investors focusing specifically on Section 8 vouchers, the ZIP code 23185 presents a challenging environment due to the high actual rental prices compared to the FMR. The slim profit margins at FMR levels make this a moderate investment opportunity. Therefore, the recommendation is to **Hold** on to existing investments and **Skip** new acquisitions unless they can be strategically positioned to attract a mix of voucher and non-voucher tenants. In summary, while the rental market in Williamsburg is strong, the high cost of living and limited availability of units at FMR levels make it difficult for Section 8-focused investors to achieve substantial returns.

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.