Location: Swain County, NC | Metro: Haywood County, NC
| Unit Size | Monthly FMR |
|---|---|
| Studio | $990 |
| 1 Bedroom | $1,010 |
| 2 Bedrooms | $1,120 |
| 3 Bedrooms | $1,440 |
| 4 Bedrooms | $1,660 |
| 5 Bedrooms | $1,926 |
| 6 Bedrooms | $2,157 |
| 7 Bedrooms | $2,330 |
| 8 Bedrooms | $2,447 |
U.S. Census Bureau data (2024)
The analysis of the Section 8 cap-rate scenario for ZIP code 28719 reveals a complex picture due to the lack of median home value data. However, we can still derive some useful insights based on the available figures.
Firstly, let's annualize the Fair Market Rent (FMR) for a 2-bedroom apartment in ZIP 28719. The FMR for a 2BR unit is set at $1240 per month for fiscal year 2024, translating to an annual rent of $14,880. Assuming a property is valued at the typical price point for the area, this would imply a gross yield based on the FMR. For instance, if a property were valued at $200,000, the gross yield would be approximately 7.44%. This calculation is crucial for understanding the potential returns under the Section 8 program.
Secondly, considering the market rent of $892 per month, derived from the Census ACS data, the annual market rent stands at $10,704. Using the same property valuation of $200,000, the gross yield based on market rent would be around 5.35%. This figure represents the actual rental income one might expect in the open market without the constraints of the Section 8 program.
The implied gross-yield comparison clearly shows that renting through the Section 8 program offers a higher potential return on investment compared to the open market. The difference between the two yields—7.44% versus 5.35%—suggests that landlords could see a significant increase in profitability by participating in the Section 8 program.
However, it's important to consider the context of the local housing market. With a renter density of 26.5%, there is a notable portion of the population looking for rental properties, which could indicate a competitive market for Section 8 units. Additionally, the Days on Market (DOM) data being unavailable suggests either a highly efficient or inefficient rental process, depending on the local dynamics. Given these factors, while the Section 8 program offers a higher gross-yield, the actual performance may vary based on how quickly units are occupied and the overall demand for subsidized housing in the area.
In conclusion, the data suggests that the Section 8 program can provide a higher gross-yield for 2-bedroom units in ZIP 28719. Landlords should weigh this potential profitability against the specifics of the local rental market, including the competition and the speed at which units are filled.
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.