Location: Martinsburg, WV | Metro: Martinsburg, WV HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $890 |
| 1 Bedroom | $950 |
| 2 Bedrooms | $1,220 |
| 3 Bedrooms | $1,690 |
| 4 Bedrooms | $1,920 |
| 5 Bedrooms | $2,227 |
| 6 Bedrooms | $2,494 |
| 7 Bedrooms | $2,694 |
| 8 Bedrooms | $2,829 |
The analysis of the Section 8 cap rate scenario for ZIP code 25421 reveals some limitations due to missing data points, particularly regarding the median home value and market rent. However, we can still provide insights based on the available information.
The Fair Market Rent (FMR) for a two-bedroom apartment in ZIP 25421 for fiscal year 2024 is set at $1,150 per month. To annualize this figure, we multiply it by 12 months, yielding an annual rental income of $13,800. This represents the maximum allowable rent that a landlord can charge for a property participating in the Section 8 program.
Given the lack of data on median home values and market rents, we cannot calculate the exact gross yield for properties in this ZIP code. However, the gross yield can be estimated using the formula: Gross Yield = (Annual Rental Income / Median Home Value) * 100%. Without the median home value, we cannot provide a precise gross yield percentage.
The implied gross yield under the Section 8 scenario would be based solely on the $13,800 annual rental income. The absence of market rent data prevents us from making a direct comparison between the Section 8 scenario and the market scenario, leaving us unable to determine which scenario offers a higher gross yield.
The unknown renter density and days on market (DOM) also complicate the analysis. Typically, a higher renter density and shorter DOM indicate a more favorable environment for rental properties, potentially making the market rent scenario more realistic if the market rent were higher than the Section 8 FMR. Conversely, if the market rent were lower or equal to the FMR, the Section 8 scenario might be more realistic.
To proceed with a comprehensive analysis, additional data such as the median home value, market rent for comparable properties, and specific metrics on renter density and DOM would be required. These factors play a critical role in determining the actual profitability and feasibility of participating in the Section 8 program versus renting at market rates.
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.