Location: Chilton County, AL | Metro: Chilton County, AL 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 | $820 |
| 1 Bedroom | $830 |
| 2 Bedrooms | $1,080 |
| 3 Bedrooms | $1,360 |
| 4 Bedrooms | $1,710 |
| 5 Bedrooms | $1,984 |
| 6 Bedrooms | $2,222 |
| 7 Bedrooms | $2,400 |
| 8 Bedrooms | $2,520 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,080 | $154,658 | 0.7% | D |
| 3BR | $1,360 | $236,429 | 0.58% | F |
| 4BR | $1,710 | $295,230 | 0.58% | F |
U.S. Census Bureau data (2024)
The market analysis for Section 8 investors in ZIP code 35045, which encompasses Clanton, AL, and the Chilton County HUD Metro FMR area, reveals a challenging but potentially rewarding rental environment. The HUD Fair Market Rent (FMR) for the area is set at $860 per month for the fiscal year 2024. In contrast, the Zillow Observed Rent Index (ZORI) for the same area stands at $1,164 per month, indicating a significant gap between the FMR and the actual market rent.
Voucher tenants in this area would typically cashflow marginally, if at all, based solely on the HUD FMR. To achieve positive cashflow, landlords should consider offering premium units that can command higher rents, closer to the market rate. This strategy allows investors to maximize their income while still adhering to the guidelines for Section 8 housing.
The median home value in ZIP 35045 is $205,942. Using this figure, we can derive a rent-to-price ratio by comparing the ZORI to the median home value. At $1,164 per month, the annual rent is approximately $13,968, leading to a rent-to-price ratio of roughly 6.78%. This ratio suggests that the cost of renting is relatively low compared to buying, which could influence potential buyers' decisions and affect the stability of the rental market.
The dynamics between renting and buying in this area are further highlighted by the lack of available data on the median days on market (DOM) and the percentage of homes that have been listed with a price cut. However, given the relatively low rent-to-price ratio, it is likely that the buy-versus-rent decision leans towards purchasing, which could impact the demand for rentals and the overall stability of the market.
The strongest investor angle in this market is stability. While cashflow might be limited due to the disparity between the HUD FMR and market rents, the low rent-to-price ratio suggests that the market is stable and less prone to sudden fluctuations. Additionally, the steady demand for affordable housing supported by Section 8 vouchers provides a reliable tenant base, ensuring consistent occupancy and rental income.
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.