Location: Transylvania County, NC | Metro: Asheville, 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 | $1,590 |
| 1 Bedroom | $1,810 |
| 2 Bedrooms | $2,000 |
| 3 Bedrooms | $2,400 |
| 4 Bedrooms | $3,300 |
| 5 Bedrooms | $3,828 |
| 6 Bedrooms | $4,287 |
| 7 Bedrooms | $4,630 |
| 8 Bedrooms | $4,862 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $2,400 | $478,417 | 0.5% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 28742 provides a detailed look at potential investment returns based on available data. The Fair Market Rent (FMR) for a two-bedroom apartment in this area for FY 2024 is set at $1410 per month. To annualize this figure, we multiply by 12, yielding an annual rent of $16,920. Given the median home value of $493,509 in the same area, the implied gross yield for a Section 8 property would be approximately 3.43%. This calculation is derived by dividing the annualized FMR by the median home value.
In contrast, the market rent for a similar two-bedroom property in ZIP 28742 is currently not available. However, if we were to consider the median home value and assume a typical market rental rate, we could infer a higher gross yield compared to the Section 8 scenario. For instance, if the market rent were to match the median home value's income potential, it would likely exceed the $1410 monthly FMR, resulting in a higher annualized rent and thus a higher gross yield.
The 20.7% renter density in ZIP 28742 suggests a moderate demand for rental properties, which could impact the viability of both Section 8 and market rent investments. However, the lack of data regarding the Days on Market (DOM) makes it difficult to assess the speed at which properties are rented out, which is a critical factor for cash flow and investment return.
Given the data, the Section 8 scenario offers a stable but lower gross yield of 3.43%. This stability comes from the government-backed rental assistance program, ensuring consistent rent payments. On the other hand, the absence of market rent data means that while the potential for a higher gross yield exists, it cannot be quantified without additional information. Investors should consider the trade-off between the guaranteed stability of Section 8 and the potentially higher returns of market rent, factoring in the local rental market dynamics and the 20.7% renter population.
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.