Location: Watauga County, NC | Metro: Ashe County, NC
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 | $740 |
| 1 Bedroom | $890 |
| 2 Bedrooms | $1,060 |
| 3 Bedrooms | $1,360 |
| 4 Bedrooms | $1,780 |
| 5 Bedrooms | $2,065 |
| 6 Bedrooms | $2,313 |
| 7 Bedrooms | $2,498 |
| 8 Bedrooms | $2,623 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,060 | $290,733 | 0.36% | F |
| 3BR | $1,360 | $365,392 | 0.37% | F |
U.S. Census Bureau data (2024)
The economics of Section 8 in ZIP code 28698, which encompasses Zionville, NC, in Watauga County, can be quite straightforward when broken down. The SAFMR (Small Area Fair Market Rent) for a two-bedroom apartment in this ZIP code for fiscal year 2026 is set at $1,150. This figure represents the maximum amount that the housing authority will pay on behalf of a tenant receiving a Section 8 voucher.
However, it's important to note that the local market rent for a two-bedroom unit in this area is significantly lower, at $713 according to the Census ACS data. This means that landlords might have to adjust their expectations if they're considering participating in the Section 8 program.
A Section 8 voucher works by covering the difference between what a tenant can afford and the actual rent. Typically, tenants are expected to contribute around 30% of their adjusted income towards rent. For example, if a tenant's monthly adjusted income is $1,000, they would pay approximately $300 towards rent. The remaining balance up to the SAFMR of $1,150 would be covered by the housing authority, but only up to the actual rent charged by the landlord.
In addition to the base rent, there are utility allowances. These vary by region and type of dwelling, but let's assume an average utility allowance of $200 per month for a two-bedroom apartment. This means that if you charge $713 for rent and include utilities, the total monthly payment you receive could be $913 ($713 for rent + $200 for utilities).
To illustrate, if the tenant's portion is $300 and the total rent including utilities is $713, the housing authority would cover the remaining $413. However, since the utility allowance is separate, the landlord receives the full $713 for rent and an additional $200 for utilities, totaling $913.
This setup leaves a significant surplus for landlords in ZIP 28698. Given the SAFMR of $1,150 and the local market rent of $713, landlords could potentially see a surplus of over $400 per month for a two-bedroom apartment when factoring in both the tenant contribution and the utility allowance.
Landlords should understand that while the SAFMR sets a cap, the actual reimbursement will align with the local market conditions. In this case, the reimbursement gap is nonexistent; instead, landlords stand to benefit from a substantial surplus due to the discrepancy between the SAFMR and the local market rent.
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.