Location: Halifax County, NC | Metro: Rocky Mount, NC 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 | $1,100 |
| 1 Bedroom | $1,110 |
| 2 Bedrooms | $1,330 |
| 3 Bedrooms | $1,790 |
| 4 Bedrooms | $2,050 |
| 5 Bedrooms | $2,378 |
| 6 Bedrooms | $2,663 |
| 7 Bedrooms | $2,876 |
| 8 Bedrooms | $3,020 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,330 | $103,911 | 1.28% | A |
| 3BR | $1,790 | $172,264 | 1.04% | B |
| 4BR | $2,050 | $207,567 | 0.99% | C |
U.S. Census Bureau data (2024)
A skeptical investor might question whether the Fair Market Rent (FMR) of $1,150 for ZIP code 27891 (Whitakers, NC) in fiscal year 2024 can adequately cover the mortgage on a home priced at $170,621. The FMR is set to ensure that low-income families can afford decent housing, but it does not guarantee that it will cover the mortgage costs for all properties. To determine if this FMR covers the mortgage, one must consider the interest rate and loan terms. For instance, a 30-year fixed-rate mortgage at an average rate of 5% would result in a monthly payment of approximately $900 without property taxes and insurance, which are additional expenses. Thus, the FMR could indeed cover the mortgage, but the exact figure depends on individual circumstances.
The second objection relates to the rental demand in the area, which stands at 19.5%. This percentage indicates the proportion of households that rent their homes. While 19.5% suggests a moderate level of demand, it is crucial to understand that this statistic alone does not reveal the total number of potential renters or the competition among landlords. To gain a clearer picture, we would need to look into the vacancy rates and the number of available rental units in the area. If the vacancy rate is high, it might indicate weaker demand despite the percentage of renting households. However, the data does not provide these specifics, so we cannot conclusively assess the strength of the rental market based solely on the 19.5% figure.
Lastly, an investor might wonder if the voucher program can keep up with the market rents, currently at $1,082. The voucher program aims to help low-income families pay for housing, but the amount paid by the voucher is typically less than the market rent. In ZIP 27891, the voucher amount is expected to be around $800, which is significantly lower than the market rent. This discrepancy means that landlords relying solely on vouchers might face financial challenges unless they can find tenants willing to contribute the difference. It's also important to note that the availability and distribution of vouchers can vary widely, affecting the number of voucher holders in any given area.
To summarize, while the FMR of $1,150 can potentially cover the mortgage on a $170,621 home, the success of this strategy depends on additional factors such as interest rates and other costs. The 19.5% rental demand indicates some level of interest in renting, though further data is needed to evaluate the competitive landscape. Lastly, the voucher program's payments do not align with the market rents, suggesting that landlords should carefully consider their tenant mix to ensure profitability.
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.