Location: Orlando-Kissimmee-Sanford, FL | Metro: Lakeland-Winter Haven, FL MSA
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 | $1,110 |
| 1 Bedroom | $1,180 |
| 2 Bedrooms | $1,420 |
| 3 Bedrooms | $1,950 |
| 4 Bedrooms | $2,370 |
| 5 Bedrooms | $2,749 |
| 6 Bedrooms | $3,079 |
| 7 Bedrooms | $3,325 |
| 8 Bedrooms | $3,491 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,180 | $87,574 | 1.35% | A |
| 2BR | $1,420 | $171,209 | 0.83% | C |
| 3BR | $1,950 | $289,987 | 0.67% | D |
| 4BR | $2,370 | $366,991 | 0.65% | D |
| 5BR | $2,749 | $711,060 | 0.39% | F |
U.S. Census Bureau data (2024)
To determine if you should buy in ZIP code 33898 (Lake Wales, FL) for Section 8 investments, follow this decision tree:
1) Does FMR $1130 (zip FY 2024) clear debt service on a $251,314 property?
No. The Fair Market Rent (FMR) for ZIP 33898 is set at $1130 for fiscal year 2024. To clear debt service, which includes principal and interest payments on a mortgage, property taxes, insurance, and other expenses, you would need a higher rental income. For a property valued at $251,314, typical debt service costs would exceed $1130 per month, making it difficult to break even on a Section 8 rental without additional subsidies or cost reductions.
2) Is market rent $1,725 (ZORI) above, at, or below FMR?
Above. The Zillow Observed Rental Index (ZORI) for Lake Wales, FL, indicates a market rent of $1,725, which is significantly higher than the FMR of $1130. This suggests that the market rate exceeds what Section 8 tenants can pay, potentially leading to challenges in filling vacancies with only Section 8 vouchers.
3) Are 12.6% renters + N/A-day DOM enough demand?
It depends. The percentage of renters in ZIP 33898 is 12.6%, indicating a relatively low demand for rentals compared to owner-occupied properties. However, the Days on Market (DOM) figure is listed as N/A, which could mean that either there's insufficient data to determine how quickly rental units are typically filled or that the market is stable and listings don't stay open long. Given the low percentage of renters and the uncertainty around DOM, it's unclear whether there's sufficient demand to justify investing solely in Section 8 properties.
If you answered No to question 1, then purchasing in this area for Section 8 purposes is not advisable unless you can reduce costs or find subsidies to cover the shortfall. A No answer also implies that you might struggle to find tenants willing to pay the FMR, given that the market rent is higher.
A Above answer to question 2 means that the market is likely to favor non-Section 8 tenants who can afford the higher rates. This could lead to lower occupancy rates for Section 8 properties, as they might be less attractive to potential tenants.
The It depends answer to question 3 requires further investigation into local rental market dynamics. While the percentage of renters is low, the lack of DOM data makes it hard to assess how quickly properties are rented out once they become available.
In conclusion, based on the provided data, the investment in ZIP 33898 for Section 8 purposes is questionable. The FMR does not clear debt service on a $251,314 property, the market rent is substantially higher than the FMR, and the demand for rentals appears limited. Consider diversifying your portfolio with a mix of market-rate and Section 8 properties or look into other areas where the FMR aligns better with property values and debt service requirements.
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.