Location: Bradford County, FL | Metro: Gainesville, FL 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 | $1,230 |
| 1 Bedroom | $1,280 |
| 2 Bedrooms | $1,400 |
| 3 Bedrooms | $1,740 |
| 4 Bedrooms | $2,320 |
| 5 Bedrooms | $2,691 |
| 6 Bedrooms | $3,014 |
| 7 Bedrooms | $3,255 |
| 8 Bedrooms | $3,418 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,740 | $296,943 | 0.59% | F |
U.S. Census Bureau data (2024)
The analysis of the Section 8 cap rate scenario for ZIP code 32044 reveals some interesting dynamics for potential landlords and small-portfolio investors. To begin with, let's look at the annualized Fair Market Rent (FMR) for a two-bedroom property, which stands at $1420 for fiscal year 2024. This figure contrasts with the market rent, which is recorded at $1,311 based on Census ACS data.
Using these figures, we can calculate the implied gross yields for both scenarios. For the Section 8 scenario, the annual rent of $1420 translates into an implied gross yield of approximately 5.32% when applied to the median home value of $266,754. The formula used here is: ($1420 / $266,754) * 100 = 5.32%. On the other hand, using the market rent figure of $1,311, the implied gross yield drops to around 4.92%, calculated similarly: ($1,311 / $266,754) * 100 = 4.92%.
Given that 27.7% of the population in ZIP 32044 is renters, it's important to consider the implications for both rental strategies. While the Section 8 scenario provides a slightly higher gross yield, the reality of the situation is more nuanced. The lack of data on days on market (DOM) suggests that there might be challenges in finding tenants quickly, which could impact cash flow and the overall attractiveness of the investment.
In conclusion, while the Section 8 program offers a marginally better gross yield compared to market rents, the actual performance may vary due to the specific characteristics of the ZIP code. Landlords and investors should weigh the benefits of the higher yield against the potential difficulties in tenant acquisition and retention. Both scenarios provide a clear basis for comparison, allowing investors to make informed decisions based on their risk tolerance and investment goals.
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.