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 | $790 |
| 1 Bedroom | $850 |
| 2 Bedrooms | $920 |
| 3 Bedrooms | $1,160 |
| 4 Bedrooms | $1,300 |
| 5 Bedrooms | $1,508 |
| 6 Bedrooms | $1,689 |
| 7 Bedrooms | $1,824 |
| 8 Bedrooms | $1,915 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $920 | $53,306 | 1.73% | A+ |
| 3BR | $1,160 | $72,928 | 1.59% | A+ |
| 4BR | $1,300 | $110,481 | 1.18% | B |
U.S. Census Bureau data (2024)
The Fair Market Rent (FMR) for ZIP code 35204 in Birmingham, Alabama, for fiscal year 2024 is set at $970. This figure represents the maximum amount that a landlord can charge for rent under the Section 8 program. It's important to note that this is not the actual rent you will receive; it's the benchmark against which rents are compared.
In contrast, the local Zillow Observed Rental Index (ZORI) stands at $841. This is the average rent charged for similar properties in the area, based on market conditions. If your property's rent is below this average but above the ZORI, it could still be competitive and attract tenants, but you'll need to ensure it meets the quality standards expected by both tenants and the housing authority.
The 53.8% renter share indicates that over half of the households in ZIP 35204 are renters. This high percentage suggests a strong demand for rental properties, especially those affordable under the Section 8 program. However, it also means competition for tenants could be fierce, so maintaining a high-quality property is crucial.
The median household income in ZIP 35204 is $69,847. While this figure doesn't directly impact your decision to participate in Section 8, it can influence your acquisition costs if you're looking to buy a property. Properties in higher-income areas might command higher prices, but the FMR cap could limit your ability to earn a higher return through rent alone.
Before committing to a Section 8 rental, verify that your property meets all the necessary requirements. Specifically, check that the rent you plan to charge does not exceed the $970 FMR limit and that your property passes the inspection criteria set by the housing authority. This ensures compliance and avoids any issues that could delay or prevent tenancy.
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.