Section 8 Fair Market Rent (FMR) for ZIP 35022 - 2027

Location: Birmingham-Hoover, AL | Metro: Birmingham-Hoover, AL HUD Metro FMR Area

Investment Score for ZIP 35022

Monthly Rent (2BR)

$1,210

Median Price (2BR)

$149,578

1% Rule

0.81%

Annual Yield

9.71%

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	$1,040
1 Bedroom	$1,110
2 Bedrooms	$1,210
3 Bedrooms	$1,520
4 Bedrooms	$1,710
5 Bedrooms	$1,984
6 Bedrooms	$2,222
7 Bedrooms	$2,400
8 Bedrooms	$2,520

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,210	$149,578	0.81%	C
3BR	$1,520	$257,515	0.59%	F
4BR	$1,710	$340,742	0.5%	F
5BR	$1,984	$376,807	0.53%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

Population

23,126

Median Household Income

$81,846

Housing Units

10,398

Renter Percentage

22.7%

Occupancy Rate

91.5%

Renter Occupied

2,155

To decide whether to invest in ZIP 35022 (Bessemer, AL) for Section 8 properties, follow these steps:

1) Does FMR $1,140 (zip FY 2024) clear debt service on a $279,912 property?

No: The Fair Market Rent (FMR) of $1,140 is insufficient to cover typical debt service costs on a property valued at $279,912. Debt service includes mortgage payments, property taxes, insurance, and maintenance. Given the value of the property, these costs would likely exceed the FMR, making it unprofitable without additional subsidies.

2) Is market rent $1,929 (ZORI) above, at, or below FMR?

Above: The Zillow Observed Rental Index (ZORI) of $1,929 is significantly higher than the FMR of $1,140. This indicates that the market rent is well above the FMR, suggesting potential profitability outside of Section 8 but also indicating a mismatch between market rates and Section 8 rates. Landlords would need to consider if they want to focus on Section 8 tenants or potentially other segments of the rental market.

3) Are 22.7% renters + 20-day DOM enough demand?

It Depends: With 22.7% of residents being renters and an average Days on Market (DOM) of 20 days, there is moderate demand for rental properties. However, the profitability of a Section 8 property hinges on the ability to cover expenses with the FMR. Given the low FMR relative to property value, even moderate demand might not translate into a viable investment unless the landlord can secure additional subsidies or has other means of reducing costs.

In summary, ZIP 35022 presents a challenging environment for Section 8 investments due to the low FMR relative to property values. While the market rent is attractive and suggests broader rental market opportunities, the specific requirements of Section 8 make it less favorable for landlords looking to invest solely in this program.

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.