Location: Virginia Beach-Norfolk-Newport News, VA | Metro: Virginia Beach-Norfolk-Newport News, VA-NC HUD Metro FMR Area
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 | $1,240 |
| 1 Bedroom | $1,260 |
| 2 Bedrooms | $1,410 |
| 3 Bedrooms | $1,940 |
| 4 Bedrooms | $2,290 |
| 5 Bedrooms | $2,656 |
| 6 Bedrooms | $2,975 |
| 7 Bedrooms | $3,213 |
| 8 Bedrooms | $3,374 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,940 | $401,064 | 0.48% | F |
| 4BR | $2,290 | $525,377 | 0.44% | F |
U.S. Census Bureau data (2024)
The analysis of the Section 8 program in ZIP 27916 reveals a significant gap between the Fair Market Rent (FMR) of $1510 and the average monthly rent of $1359. This represents a difference of $151, or approximately 11.1%, in favor of the FMR. Given that the FMR is higher than the market rent, landlords can benefit from accepting housing vouchers, as voucher tenants often provide a more stable and reliable source of income compared to open-market renters.
In ZIP 27916, the median home value stands at $416,426, while the median income is $79,329. Only 10.8% of residents are renters, indicating a predominantly owner-occupied area. However, for those who do choose to rent, the high vacancy rate of 22.2% and a price-to-rent ratio of 25.1 suggest that cash flow may be challenging at these prices. Accepting Section 8 tenants can help mitigate the risk of vacancies and provide a steady stream of rental income.
The investment case in 27916 is solid for landlords who understand the nuances of managing properties with voucher tenants. While the median home value is relatively accessible at $410K, the management intensity and potential for capital expenditures are real considerations. The best overall value in terms of bedrooms is found in 3BR properties, which offer a median value of $388,969 and an estimated rent of $2,090 per month, providing a 3.9% cap rate and a 7.6% 5-year Compound Annual Growth Rate (CAGR).
Landlords should be aware of the specific risks associated with this ZIP code, including high vacancy rates and a price-to-rent ratio that makes cash flow challenging. Despite these risks, the gap between FMR and market rent provides an opportunity for landlords to generate a yield by accepting housing vouchers, making it a viable strategy for those willing to manage the complexities of the local rental market.
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.