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 | $960 |
| 1 Bedroom | $1,030 |
| 2 Bedrooms | $1,120 |
| 3 Bedrooms | $1,410 |
| 4 Bedrooms | $1,580 |
| 5 Bedrooms | $1,833 |
| 6 Bedrooms | $2,053 |
| 7 Bedrooms | $2,217 |
| 8 Bedrooms | $2,328 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,120 | $51,713 | 2.17% | A+ |
| 3BR | $1,410 | $81,704 | 1.73% | A+ |
| 4BR | $1,580 | $149,286 | 1.06% | B |
U.S. Census Bureau data (2024)
The Fair Market Rent (FMR) for ZIP code 35217 in Tarrant, Alabama, for fiscal year 2024 is set at $1,040. This figure represents the payment standard used by the U.S. Department of Housing and Urban Development (HUD) for the Section 8 housing program. It does not represent the rent you can charge your tenants; rather, it's the maximum amount HUD will pay for a unit in this area.
In contrast, the local median rent for a two-bedroom apartment in ZIP 35217 is $1,143, according to the ZORI (Zillow Observed Rent Index). This indicates that landlords participating in Section 8 might need to adjust their expectations slightly, as the actual rents charged may be below the market rate.
The 52.5% renter share of income suggests a robust demand for affordable housing in Tarrant. On average, renters in this area spend over half of their income on housing, indicating a high need for subsidized options. The median household income in ZIP 35217 is approximately $81,294, which can help guide decisions on property acquisition costs. Given the income levels and the demand for affordable housing, properties priced reasonably can still offer good returns, albeit through government subsidies rather than market-rate rents.
Before committing to a Section 8 rental property, it is crucial to verify the rent limits set by HUD. These limits ensure that the rent you charge is reasonable and affordable for the tenants, and they are based on the FMR. By confirming these limits, you can avoid any issues with HUD approval and ensure your investment aligns with the program requirements.
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.