Location: Birmingham-Hoover, AL | Metro: Birmingham-Hoover, 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 | $1,630 |
| 1 Bedroom | $1,750 |
| 2 Bedrooms | $1,910 |
| 3 Bedrooms | $2,400 |
| 4 Bedrooms | $2,700 |
| 5 Bedrooms | $3,132 |
| 6 Bedrooms | $3,508 |
| 7 Bedrooms | $3,789 |
| 8 Bedrooms | $3,978 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $2,400 | $289,544 | 0.83% | C |
| 4BR | $2,700 | $432,446 | 0.62% | D |
U.S. Census Bureau data (2024)
ZIP code 35147, located within the Birmingham-Hoover, AL HUD Metro FMR Area, exhibits characteristics that place it in a distinct category compared to other ZIP codes in the same metro area. The Fair Market Rent (FMR) for 35147 stands at $1,870 for fiscal year 2024, which is notably higher than the average market rent of $1,226. This suggests that while the FMR is set higher to reflect potential rental costs, the actual market rent is lower, indicating a possible undervaluation of rents in this ZIP code relative to what the government deems fair.
The median home value in 35147 is $326,742, which is slightly above the metro-wide average. However, the renter share of 8.8% is lower than many areas within the Birmingham-Hoover metro, where the average renter share might be higher. This combination of slightly above-average home values and a relatively low renter share does not immediately suggest a value pocket or a premium sub-market. Instead, it points towards a mid-tier neighborhood where property ownership is more common, but there is still a presence of renters.
When considering the potential attractiveness of 35147 for Section 8 landlords and small-portfolio investors, the divergence between the FMR and the actual market rent is significant. Landlords in this ZIP code could potentially benefit from the discrepancy, as they may receive higher subsidies per unit due to the higher FMR. This makes 35147 an interesting opportunity for investors looking for a balance between fair rental rates and government assistance, without necessarily competing in the most densely rented areas of the metro.
To further contextualize the position of 35147 within the Birmingham-Hoover, AL HUD Metro FMR Area, it's important to note that the high FMR combined with the lower market rent and modest renter share does not fit the profile of a typical Section 8 sweet spot. Sweet spots usually have a high renter share with below-metro home values, indicating a concentration of affordable housing options for subsidized tenants. In contrast, 35147 offers a scenario where landlords can potentially secure higher rental incomes with government support, making it a viable option for those seeking stable rental income in a moderately priced market.
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.