Section 8 Fair Market Rent (FMR) for ZIP 32526 - 2027

Investment Score for ZIP 32526

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,180
1 Bedroom	$1,390
2 Bedrooms	$1,580
3 Bedrooms	$2,080
4 Bedrooms	$2,490
5 Bedrooms	$2,888
6 Bedrooms	$3,235
7 Bedrooms	$3,494
8 Bedrooms	$3,669

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,580	$158,685	1%	C
3BR	$2,080	$254,128	0.82%	C
4BR	$2,490	$338,055	0.74%	D
5BR	$2,888	$427,895	0.67%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 32526 (Pensacola, FL) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 32526 in Pensacola, Florida, is set by HUD for 2026. For a two-bedroom unit, the FMR is $1520, which represents 24.3% of the median household income of $75,098. This suggests that the rent for a two-bedroom unit is relatively affordable compared to the local income levels. However, it's important to understand how these FMRs compare to actual rents in the area. According to Zillow, the median price for a two-bedroom home in this ZIP code is $158,992. The price-to-FMR ratio is 8.7x, indicating that the purchase price of homes is significantly higher than the rental rates covered by vouchers. This means that landlords who participate in the Section 8 program must be willing to accept lower rental income relative to the value of their property. Landlords who receive Section 8 vouchers have constraints based on the FMR. They cannot charge more than the FMR for units covered under the program. For example, a three-bedroom unit cannot exceed $2030 per month, and a four-bedroom unit cannot exceed $2500 per month. These limits can affect the profitability of properties for landlords, especially if they are located in areas where market rents are higher. #### Affordability & Renter Profile In ZIP code 32526, 23.8% of the population are renters, indicating a moderate rental market. With a total population of 44,680, this translates to approximately 10,600 renters. The occupancy rate of 92.6% suggests that the rental market is fairly tight, with most available units being occupied. Given the median household income of $75,098, the affordability of housing is a significant concern for many residents. The FMR for a two-bedroom unit at $1520 is 24.3% of the median income, which is a reasonable proportion. However, the high price-to-FMR ratio indicates that purchasing a home is less affordable relative to renting. This makes the rental market particularly important for low-income families who might rely on Section 8 vouchers. #### Investor Angle From an investor perspective, the ZIP code 32526 offers a mixed picture. The FMRs provide a baseline for rental income, but the high price-to-FMR ratio suggests that the purchase cost of properties is much higher than what can be recouped through rental income alone. To determine if this ZIP code is cash-flow positive at FMR, we need to consider the typical expenses associated with owning and managing rental properties. Assuming a conservative estimate of 30% of the purchase price for annual expenses (including mortgage payments, maintenance, insurance, and property taxes), the annual expense for a two-bedroom unit would be around $47,697.60 ($158,992 * 0.3). This translates to a monthly expense of about $3974.80. Given the FMR of $1520 for a two-bedroom unit, the net cash flow would be negative unless the landlord can leverage other sources of income or subsidies. The investment grade for this ZIP code would be considered low due to the high purchase costs relative to rental income. Investors looking to participate in the Section 8 program should carefully evaluate their financial models to ensure that they can cover all expenses and still achieve a reasonable return on investment. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the constraints of FMR, investors should focus on smaller units such as one-bedroom and two-bedroom apartments. These units are more likely to be rented out at or near the FMR without leaving landlords with a significant shortfall. For instance, a one-bedroom unit with an FMR of $1300 might be easier to manage financially than a four-bedroom unit with an FMR of $2500. 2. **Consider Location and Amenities**: While the overall market is tight, certain locations within the ZIP code might offer better opportunities. Areas closer to employment centers, schools, and public transportation could command slightly higher rents while still staying within FMR guidelines. Additionally, adding amenities like parking, laundry facilities, or updated appliances can help attract tenants and potentially justify a higher rent within the FMR limit. 3. **Seek Additional Revenue Streams**: To make the investment more viable, investors should look for ways to generate additional revenue. This could include charging for parking, offering storage units, or renting out common spaces. These supplementary income sources can help offset the high purchase costs and bring the overall cash flow into a more positive range. #### Bottom Line For Section 8-focused investors, the ZIP code 32526 presents a challenging environment. The high price-to-FMR ratio suggests that the purchase cost of properties is significantly higher than the rental income they can generate under the Section 8 program. Therefore, the recommendation is to **Skip** this ZIP code for now unless you can find properties at a discount or in locations where market rents are closer to the FMR. If you do decide to invest, focus on smaller units and seek additional revenue streams to improve cash flow. This analysis is based solely on the provided data and does not account for any external factors that might influence the market dynamics. Always conduct thorough due diligence before making any investment decisions.

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.