Location: Gainesville, FL | Metro: Gainesville, FL HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,100 |
| 1 Bedroom | $1,130 |
| 2 Bedrooms | $1,350 |
| 3 Bedrooms | $1,690 |
| 4 Bedrooms | $1,920 |
| 5 Bedrooms | $2,227 |
| 6 Bedrooms | $2,494 |
| 7 Bedrooms | $2,694 |
| 8 Bedrooms | $2,829 |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 32694 in Waldo, Florida, reveals an interesting scenario when comparing federally mandated rental rates to market conditions. For a two-bedroom unit, the Fair Market Rent (FMR) set by HUD for fiscal year 2024 is $1030 per month. If we annualize this figure, it translates to an annual rental income of $12,360. Given the median home value of $229,575, this implies a gross yield of approximately 5.4%. This calculation is based on the formula for gross yield: (Annual Rental Income / Property Value) * 100.
In contrast, the market rent for a two-bedroom unit in ZIP 32694, according to the Census ACS, stands at $705 per month. When annualized, this equates to an annual rental income of $8,460. Using the same median home value of $229,575, the gross yield drops to about 3.7%. These figures clearly show a significant difference between the potential rental income under Section 8 versus the prevailing market rates.
The higher gross yield of 5.4% associated with Section 8 rents is more attractive compared to the market yield of 3.7%. However, the decision to participate in the Section 8 program must also consider the local rental market dynamics. With a renter density of 30.1%, there is a substantial portion of the population that relies on rental housing, including those who might be eligible for Section 8 assistance. The fact that the days-on-market (DOM) statistic is listed as N/A suggests either limited data availability or a relatively stable market where properties do not spend much time vacant.
Given the higher gross yield under Section 8, it presents a more financially viable option for landlords and small-portfolio investors looking to secure steady rental income. However, the actual investment decision should factor in the specifics of the local market, including tenant demand and the administration of Section 8 subsidies. Despite these considerations, the financial advantage of a 5.4% gross yield over a 3.7% market yield is compelling for those willing to navigate the requirements of the Section 8 program.
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.