Location: Lynchburg, VA | Metro: Lynchburg, VA MSA
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 | $930 |
| 1 Bedroom | $930 |
| 2 Bedrooms | $1,070 |
| 3 Bedrooms | $1,480 |
| 4 Bedrooms | $1,580 |
| 5 Bedrooms | $1,833 |
| 6 Bedrooms | $2,053 |
| 7 Bedrooms | $2,217 |
| 8 Bedrooms | $2,328 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $930 | $133,341 | 0.7% | D |
| 2BR | $1,070 | $176,977 | 0.6% | D |
| 3BR | $1,480 | $262,140 | 0.56% | F |
| 4BR | $1,580 | $314,970 | 0.5% | F |
| 5BR | $1,833 | $346,758 | 0.53% | F |
U.S. Census Bureau data (2024)
The market analysis for Section 8 investors targeting ZIP code 24572, located in Madison Heights, VA, within the Amherst County and Lynchburg, VA MSA, reveals a competitive but manageable environment. The HUD Fair Market Rent (FMR) for this area in fiscal year 2024 is set at $910 per month. In contrast, the Zillow Observed Rent Index (ZORI), which reflects the actual market rents, stands at $1,169 per month. This indicates that landlords can expect marginal cash flow when renting properties to voucher tenants at the FMR rate. However, the situation improves significantly with premium units that can command higher rents closer to the ZORI.
To further understand the investment potential, consider the median home value in ZIP 24572, which is $240,904. Using this figure, we can calculate the rent-to-price ratio. At the ZORI rent of $1,169, the annual rent would be approximately $14,028. Dividing this by the median home value yields a rent-to-price ratio of about 5.8%. This suggests that the rental income is relatively low compared to the property values, indicating a stronger buy market over the rent market. However, for investors focused on rental income, this ratio still provides a solid foundation for cash flow.
The dynamics between renting and buying in this market are further underscored by the fact that there is no available data on the median Days on Market (DOM) or the percentage of homes that have undergone price cuts. This lack of information implies that the housing market is stable, with little fluctuation in sales activity and pricing. For investors, this stability is crucial as it minimizes risks associated with rapid changes in the local real estate landscape.
In conclusion, while voucher tenants in ZIP 24572 will provide marginal cash flow at the FMR rate, premium units offer a better opportunity for positive cash flow. Given the stable market conditions and the favorable long-term investment potential, the strongest angle for Section 8 investors here is stability, ensuring consistent returns without the volatility seen in other markets.
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.