Section 8 Fair Market Rent (FMR) for ZIP 27407 - 2027

Investment Score for ZIP 27407

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	$1,220
1 Bedroom	$1,270
2 Bedrooms	$1,380
3 Bedrooms	$1,790
4 Bedrooms	$2,100
5 Bedrooms	$2,436
6 Bedrooms	$2,728
7 Bedrooms	$2,946
8 Bedrooms	$3,093

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
2BR	$1,380	$172,603	0.8%	D
3BR	$1,790	$245,393	0.73%	D
4BR	$2,100	$371,311	0.57%	F
5BR	$2,436	$220,348	1.11%	B

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 27407 (Greensboro, NC) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 27407 in Greensboro, NC, as of 2026, is set at $1440 for a two-bedroom unit. This figure represents 29.1% of the median household income in the area, which is $59,427. However, the actual rental market in this ZIP code is significantly higher than the FMR. According to Zillow, the median price for a two-bedroom home is $172,450, which translates to a monthly rent of approximately $1437 based on typical mortgage rates and property taxes. The price-to-FMR ratio is 10.0x, indicating that the actual rental prices are much higher than what the FMR suggests. This means that tenants using Section 8 vouchers face significant constraints when trying to find housing. They must locate landlords who are willing to accept the voucher and charge the specified FMR rate, which is lower than the market rate. For instance, a landlord would need to charge $1440 for a two-bedroom unit, whereas the market rate might be closer to $1437 or even higher. This discrepancy can make it challenging for voucher holders to secure housing, especially if landlords prefer higher-paying market-rate tenants. #### Affordability & Renter Profile ZIP code 27407 has a population of 51,697, with 51.4% of residents being renters. This high percentage of renters suggests a strong demand for rental properties in the area. The occupancy rate stands at 91.9%, indicating that the market is relatively tight, with most available units being occupied. Given the median household income of $59,427, many residents may struggle to afford market-rate rents, particularly for larger units like three or four bedrooms, where the FMR is $1840 and $2120 respectively. The high renter percentage and occupancy rate suggest that there is a significant number of individuals and families who rely on affordable housing options. These renters likely include low-income workers, students, and families who are seeking stable housing but are constrained by their financial resources. The affordability gap between the FMR and market rates highlights the challenges these renters face in finding suitable housing. #### Investor Angle From an investor's perspective, the ZIP code 27407 presents both opportunities and challenges. The FMR for a two-bedroom unit is $1440, which is lower than the market rate of around $1437. However, the actual rental market is much higher, with a price-to-FMR ratio of 10.0x. This implies that the FMR is significantly below the market rate, making it difficult for investors to achieve positive cash flow solely based on FMR rates. To determine whether this ZIP code is cash-flow positive at FMR, we need to consider the typical expenses associated with owning and renting out a property. These include mortgage payments, property taxes, insurance, maintenance, and other operational costs. Assuming a conservative estimate of total expenses at 75% of the FMR, the net income for a two-bedroom unit would be: \[ \text{Net Income} = \text{FMR} - (\text{FMR} \times 0.75) \] \[ \text{Net Income} = \$1440 - (\$1440 \times 0.75) \] \[ \text{Net Income} = \$1440 - \$1080 \] \[ \text{Net Income} = \$360 \] Given the high market rates, investors may be able to negotiate higher rents with landlords who are willing to accept Section 8 vouchers. However, this still leaves a significant gap between the FMR and market rates, potentially leading to negative cash flow unless the investor can leverage other subsidies or incentives. #### Specific Actionable Insights 1. **Target Larger Units**: Investors should focus on larger units such as three and four-bedroom homes, which have higher FMRs of $1840 and $2120 respectively. These units are more likely to attract families with children, who often qualify for higher voucher amounts. By targeting these larger units, investors can potentially achieve better cash flow and meet the needs of a growing segment of the rental market. 2. **Seek Additional Subsidies**: Given the tight market and high renter percentage, investors should explore additional subsidies and incentives beyond just the FMR. This could include state or local housing assistance programs, tax credits, or grants designed to support affordable housing initiatives. These additional funds can help bridge the gap between the FMR and market rates, making the investment more financially viable. #### Bottom Line Based on the provided data, the recommendation for Section 8-focused investors in ZIP code 27407 is to **Skip** this market. The significant disparity between the FMR and market rates makes it challenging to achieve positive cash flow without additional subsidies. Furthermore, the high occupancy rate and tight market conditions suggest that there is limited availability of units that would be suitable for Section 8 tenants. While there is potential in targeting larger units and seeking additional subsidies, the overall market dynamics do not favor a straightforward investment strategy based solely on FMR rates.

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.