Location: West Palm Beach-Boca Raton, FL | Metro: West Palm Beach-Boca Raton, 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 | $2,110 |
| 1 Bedroom | $2,220 |
| 2 Bedrooms | $2,600 |
| 3 Bedrooms | $3,380 |
| 4 Bedrooms | $3,900 |
| 5 Bedrooms | $4,524 |
| 6 Bedrooms | $5,067 |
| 7 Bedrooms | $5,472 |
| 8 Bedrooms | $5,746 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,600 | $331,283 | 0.78% | D |
| 3BR | $3,380 | $462,137 | 0.73% | D |
| 4BR | $3,900 | $549,034 | 0.71% | D |
| 5BR | $4,524 | $652,206 | 0.69% | D |
U.S. Census Bureau data (2024)
The analysis for Section 8 properties in ZIP code 33413, located in West Palm Beach, FL, reveals a significant gap between the Fair Market Rent (FMR) set by the government and the actual market rent. For fiscal year 2024, the FMR is established at $2490, whereas the Zillow Observed Rent Index (ZORI), which reflects the market conditions, stands at $2,130. This indicates that the FMR exceeds the market rent by $360, or approximately 17%. The higher FMR means that landlords can receive a premium above the local average rental rate when they accept Section 8 vouchers.
In West Palm Beach, where 32.2% of residents are renters, and the median home value is $482,180, the median income of $91,131 influences the demand for affordable housing options. The discrepancy between FMR and ZORI makes it a lucrative opportunity for landlords, as they can secure a steady stream of rental income at a rate higher than what the market would typically bear. This is particularly advantageous given the relatively high median home values and incomes in the area, which can translate into higher competition for traditional rental units and a greater reliance on subsidized housing.
However, accepting Section 8 tenants also comes with its own set of considerations. Landlords must adhere to HUD guidelines, ensuring that their properties meet minimum health and safety standards, which can incur additional costs. Moreover, there might be limitations on how much rent can be increased annually, which could affect long-term cash flow projections. Despite these factors, the $360 premium per unit over the market rate makes it a compelling strategy for maximizing yields in a competitive rental market.
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.