Location: Deltona-Daytona Beach-Ormond Beach, FL | Metro: Deltona-Daytona Beach-Ormond Beach, 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 | $1,170 |
| 1 Bedroom | $1,260 |
| 2 Bedrooms | $1,550 |
| 3 Bedrooms | $2,040 |
| 4 Bedrooms | $2,230 |
| 5 Bedrooms | $2,587 |
| 6 Bedrooms | $2,897 |
| 7 Bedrooms | $3,129 |
| 8 Bedrooms | $3,285 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,260 | $136,965 | 0.92% | C |
| 2BR | $1,550 | $282,101 | 0.55% | F |
| 3BR | $2,040 | $483,083 | 0.42% | F |
| 4BR | $2,230 | $516,790 | 0.43% | F |
| 5BR | $2,587 | $639,679 | 0.4% | F |
U.S. Census Bureau data (2024)
The Section 8 thesis for ZIP code 32118 in Daytona Beach, FL, centers around the discrepancy between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR stands at $1340, while the Zillow Observed Rent Index (ZORI) indicates a market rent of $1501. This creates a gap of $161, which translates to approximately 12% below the market rate.
The significance of this gap for landlords and small-portfolio investors lies in the cost implications of housing voucher tenants. Since the FMR is lower than the market rent, landlords must absorb the difference between the FMR and the actual rent charged to tenants. In other words, landlords will receive $1340 per month from the government for a unit that could otherwise rent for $1501, resulting in a financial shortfall of $161 per unit each month.
In the context of Daytona Beach, where 34.4% of residents are renters and the median home value is $290,112, the median household income is $61,266. Given these economic conditions, landlords need to be aware of the financial realities when considering Section 8 properties. The decision to participate in the Section 8 program should weigh the benefits of stable, government-backed rental income against the potential loss of revenue due to the FMR being below market rates.
To illustrate the impact, consider a property with five units. At a monthly shortfall of $161 per unit, the total annual loss would amount to $9,660. This figure can significantly affect an investor's bottom line and must be factored into any investment strategy involving Section 8 housing.
Moreover, landlords should evaluate the broader implications of accepting voucher tenants. While the program offers long-term tenancy stability, it also comes with certain administrative burdens and regulations that must be adhered to. These factors, combined with the financial gap, form the core of the Section 8 investment thesis in ZIP 32118.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.