Location: Virginia Beach-Norfolk-Newport News, VA | Metro: Virginia Beach-Norfolk-Newport News, VA-NC 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 | $1,220 |
| 1 Bedroom | $1,230 |
| 2 Bedrooms | $1,380 |
| 3 Bedrooms | $1,900 |
| 4 Bedrooms | $2,240 |
| 5 Bedrooms | $2,598 |
| 6 Bedrooms | $2,910 |
| 7 Bedrooms | $3,143 |
| 8 Bedrooms | $3,300 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,380 | $183,901 | 0.75% | D |
| 3BR | $1,900 | $237,457 | 0.8% | C |
| 4BR | $2,240 | $290,835 | 0.77% | D |
U.S. Census Bureau data (2024)
Newport News, VA, specifically ZIP 23605, offers a strategic fit for a Section 8 portfolio due to its characteristics as a cash-flow anchor. This designation is based on the significant spread between the Fair Market Rent (FMR) set by HUD and the actual market rents in the area.
The FMR for ZIP 23605 in fiscal year 2024 is $1260, which is notably lower than the market rent of $1,529. This $269 difference represents a substantial cushion that can be utilized to ensure positive cash flow. Landlords and small-portfolio investors can leverage this gap by setting rents slightly above the FMR but still below the market rate, thereby attracting tenants who qualify for Section 8 vouchers while maintaining profitability.
The median home value in ZIP 23605 stands at $225,690. While this figure is important for understanding the overall real estate landscape, it is less relevant to a Section 8 strategy focused on rental properties. The key metric here is the rent-to-income ratio, which is favorable given the median income of $53,815. This suggests that tenants in this area have the financial stability to maintain consistent rental payments, reducing the risk of default.
A cash-flow anchor like ZIP 23605 provides a stable foundation for an investment portfolio. The low FMR relative to market rents ensures that properties can be rented out at rates that cover expenses and generate profit, even when dealing with subsidized housing programs. This stability is crucial for investors looking to balance their portfolios with reliable sources of income.
In conclusion, ZIP 23605 is best suited as a cash-flow anchor within a Section 8 portfolio strategy. Its FMR of $1260 is significantly below the market rent of $1,529, allowing for positive cash flow opportunities. The median income of $53,815 supports tenant reliability, further securing the financial health of the investment.
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.