Section 8 Fair Market Rent (FMR) for ZIP 32909 - 2027

Investment Score for ZIP 32909

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	$1,340
1 Bedroom	$1,540
2 Bedrooms	$1,800
3 Bedrooms	$2,410
4 Bedrooms	$2,740
5 Bedrooms	$3,178
6 Bedrooms	$3,559
7 Bedrooms	$3,844
8 Bedrooms	$4,036

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	$1,800	$206,442	0.87%	C
3BR	$2,410	$290,686	0.83%	C
4BR	$2,740	$350,934	0.78%	D
5BR	$3,178	$452,245	0.7%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 32909 (Palm Bay, FL) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) figures for ZIP code 32909 in Palm Bay, Florida, provide a benchmark for rental affordability. According to the data, the 2026 FMRs are as follows: - 0BR: $1290 - 1BR: $1510 - 2BR: $1740 (which is 26.1% of the median household income) - 3BR: $2370 - 4BR: $2690 These FMRs represent the maximum rent that a Section 8 voucher holder can pay for a unit based on the number of bedrooms. However, it is important to understand how these FMRs compare to actual rents in the area. The Zillow median price for a 2BR home is $206,628, which translates into a price-to-FMR ratio of 9.9x. This suggests that the actual market rents are significantly higher than the FMRs. For instance, if we assume a typical rental yield of 5%, the implied monthly rent for a 2BR property would be approximately $860, which is far below the FMR of $1740. This discrepancy means that Section 8 voucher holders face significant constraints in finding affordable housing. They are limited to units that do not exceed the FMR, making it challenging to secure decent quality housing given the high market rents. Landlords who accept Section 8 vouchers must ensure their rents align with these guidelines, potentially limiting their ability to charge market rates. #### Affordability & Renter Profile The population of ZIP code 32909 is 41,804, with 17.3% being renters. The occupancy rate stands at 93.3%, indicating a relatively tight market where most available units are occupied. Given the median household income of $79,977, the 2BR FMR of $1740 represents a manageable portion of the income, at 26.1%. This suggests that while the market is tight, there is still a segment of the population that can afford to rent without assistance. However, the high price-to-FMR ratio indicates that the market is not particularly affordable for low-income households. The average renter would likely struggle to find housing that meets both their needs and budgetary constraints. This makes the Section 8 program crucial for ensuring that lower-income individuals have access to suitable housing options. #### Investor Angle From an investor’s perspective, the ZIP code 32909 presents a mixed picture. The FMRs provide a clear guideline for what rents can be charged for properties accepting Section 8 vouchers. However, the high price-to-FMR ratio suggests that the market rents are much higher than the FMRs. This means that landlords who accept Section 8 vouchers will likely be charging below-market rates, which could impact cash flow. To determine whether this ZIP code is cash-flow positive at FMR, we need to consider the typical expenses associated with owning and renting out a property. These include mortgage payments, property taxes, insurance, maintenance, and other operating costs. Assuming a conservative estimate of 70% of the purchase price as the mortgage amount, with a 30-year fixed-rate mortgage at 5%, the monthly mortgage payment for a 2BR property priced at $206,628 would be around $1100. Adding property taxes (estimated at 1.5% of the property value), insurance, and maintenance costs, the total monthly expenses could easily exceed the FMR of $1740. Given these factors, the investment grade for this ZIP code would be considered moderate to low. While the demand for rental units is strong, the limited ability to charge market rates due to the FMR cap makes it less attractive for investors looking to maximize returns. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units such as 0BR or 1BR properties. These units have lower FMR caps but are often more affordable to purchase and maintain. For example, a 1BR property with an FMR of $1510 might still generate positive cash flow if purchased at a lower price point. 2. **Consider Mixed-Income Developments**: Investors could explore developing mixed-income housing projects where some units are rented at market rates and others are rented at FMR rates for Section 8 voucher holders. This approach allows for balancing the financial risks and rewards, ensuring a steady stream of income while also providing affordable housing options. 3. **Engage with Local Housing Authorities**: Building relationships with local housing authorities can help streamline the process of accepting Section 8 vouchers. This can reduce administrative overhead and improve the likelihood of securing tenants quickly, which is beneficial in a tight rental market. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 32909 is to **Skip**. The high price-to-FMR ratio and the tight rental market make it challenging to achieve positive cash flow when adhering strictly to FMR guidelines. Instead, investors might want to look at areas with lower ratios or where there is more flexibility in rental pricing. Alternatively, they could consider investing in smaller units or exploring mixed-income developments to balance the financial aspects of their investments.

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.