Location: Cape Coral-Fort Myers, FL | Metro: Cape Coral-Fort Myers, 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 | $1,520 |
| 1 Bedroom | $1,530 |
| 2 Bedrooms | $1,790 |
| 3 Bedrooms | $2,310 |
| 4 Bedrooms | $2,560 |
| 5 Bedrooms | $2,970 |
| 6 Bedrooms | $3,326 |
| 7 Bedrooms | $3,592 |
| 8 Bedrooms | $3,772 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,530 | $318,595 | 0.48% | F |
| 2BR | $1,790 | $457,875 | 0.39% | F |
| 3BR | $2,310 | $802,812 | 0.29% | F |
| 4BR | $2,560 | $1,344,131 | 0.19% | F |
| 5BR | $2,970 | $1,992,203 | 0.15% | F |
U.S. Census Bureau data (2024)
The Section 8 thesis for ZIP code 33931 in Florida revolves around the disparity between the Fair Market Rent (FMR) and the actual market rent, known as Zillow Rent Index (ZORI). For fiscal year 2024, the FMR stands at $1680, while the ZORI is recorded at $1,988. This creates a gap of $308, which translates to approximately 15.4% below the market rate.
When the FMR is less than the market rent, as it is here, landlords face a scenario where they must accept lower rents than what the open market offers. The difference between the FMR and the market rent means that landlords will receive $1680 per month from the government for voucher tenants, instead of the potential $1,988 from open-market renters. This discrepancy can lead to a reduction in overall rental income and potentially affect the profitability of the investment.
In the broader context of Florida, where only 10.7% of residents are renters, and the median home value is $495,246, the decision to participate in the Section 8 program requires careful consideration. The median income in the state is $79,018, indicating that a significant portion of the population may rely on rental assistance programs like Section 8 to secure affordable housing.
To illustrate the impact of this gap, let's assume an average monthly expense of $500 for maintenance and utilities. A landlord would then need to cover these costs and still generate profit from the remaining $1,180 after subtracting the $500 expenses from the $1,680 received. This underscores the importance of understanding the local rental market and the specific requirements of the Section 8 program before making any investment decisions.
Furthermore, landlords should be aware of the administrative responsibilities associated with Section 8 tenancy. These include adherence to federal guidelines, regular inspections, and ensuring that the unit meets Housing Quality Standards (HQS). While these obligations might seem burdensome, they also provide a stable and long-term tenant base, which can be advantageous in a low-renter environment such as Florida.
In conclusion, the $308 gap between the FMR and ZORI in ZIP 33931 represents a significant challenge for landlords looking to maximize their rental yields. However, the stability and security offered by voucher tenants, combined with the local economic conditions, can still make Section 8 properties a viable investment option, particularly for those who understand and are willing to manage the associated costs and responsibilities.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.