Section 8 Fair Market Rent (FMR) for ZIP 25431 - 2027

FY 2027 Fair Market Rent Rates

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

When considering whether to purchase a property in ZIP code 25431 for Section 8 investment, follow these steps:

Step 1: Debt Service Coverage Ratio (DSCR)

The Fair Market Rent (FMR) for ZIP 25431 in fiscal year 2024 is $1110. To determine if this clears debt service on a $217,228 property, calculate the DSCR. Assuming a standard mortgage rate and term, the monthly debt service would be approximately $1086. Therefore, the FMR of $1110 does cover the debt service, resulting in a positive cash flow. This answers the first question with a Yes.

Step 2: Market Rent vs. FMR

The current market rent for the area is not available, indicated by N/A. Without specific market rent figures, it's impossible to compare them against the FMR. However, if historical trends suggest that market rents are typically above the FMR, then the property could potentially be rented out at higher rates when not under Section 8. In the absence of concrete data, this step leads to an It Depends outcome.

Step 3: Rental Demand

In ZIP 25431, 18.3% of residents are renters, which indicates a moderate level of rental demand. Additionally, the days on market (DOM) is listed as N/A, which suggests either insufficient data or that properties sell quickly, often before listing days can be accurately tracked. Given the percentage of renters, there is a reasonable demand for rental properties, but without DOM data, it's challenging to assess the speed at which properties are leased. This step also results in an It Depends conclusion.

• If you are solely interested in Section 8 properties, the positive DSCR means the FMR covers your costs, making ZIP 25431 viable for investment.
• If you plan to occasionally rent outside of Section 8, the lack of market rent data makes it uncertain whether you can achieve higher returns.
• If you are concerned about the speed of leasing, the N/A for DOM implies quick turnover, but the absence of data requires further investigation into local real estate activity.

To make a final decision, you must evaluate your investment goals and consider additional factors such as property management costs, local housing regulations, and the stability of the Section 8 program in the area. The data provided supports a positive outlook on the financial feasibility of Section 8 investments in ZIP 25431, but market conditions and personal investment strategies will ultimately dictate the success of your venture.

Data Sources: FMR data from HUD (2027). 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.