Section 8 Fair Market Rent (FMR) for ZIP 35218 - 2027

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

Investment Score for ZIP 35218

A+

Monthly Rent (2BR)

$1,110

Median Price (2BR)

$55,674

1% Rule

1.99%

Annual Yield

23.92%

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	$950
1 Bedroom	$1,020
2 Bedrooms	$1,110
3 Bedrooms	$1,390
4 Bedrooms	$1,570
5 Bedrooms	$1,821
6 Bedrooms	$2,040
7 Bedrooms	$2,203
8 Bedrooms	$2,313

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,110	$55,674	1.99%	A+
3BR	$1,390	$74,811	1.86%	A+
4BR	$1,570	$92,720	1.69%	A+

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

Population

6,981

Median Household Income

$30,739

Housing Units

3,443

Renter Percentage

63.9%

Occupancy Rate

72.4%

Renter Occupied

1,594

The ZIP code 35218 in Birmingham, AL, is a bustling urban area that offers a mix of residential and commercial spaces. It's a region where the demand for affordable housing is high, making it an attractive investment opportunity for landlords and small-portfolio investors looking to capitalize on the local rental market dynamics.

Fair Market Rent (FMR): The FMR for a two-bedroom apartment in ZIP 35218 for fiscal year 2024 is set at $1070, indicating a stable and predictable income stream for properties that meet the criteria.
Market Rent: According to ZORI, the average market rent for the area is $970, which is slightly below the FMR but still provides a solid return on investment.
Median Home Value: At $75,043, the median home value in 35218 is relatively low, making it easier for investors to acquire properties without a significant upfront capital outlay.
Renter Share: With 63.9% of the population renting their homes, there is a strong and consistent demand for rental properties in this area.
Days on Market (DOM): Although the specific days on market for rental listings is not available, the high renter share suggests that properties can be rented quickly once they become available.
Median Income: The median income of $30,739 reflects the affordability of the housing market and the potential for steady rental payments from tenants who can afford the average rent.

The combination of a high renter share and a lower median home value creates a favorable environment for rental investments in ZIP 35218. Despite the market rent being slightly below the FMR, the predictability of rental income and the ease of property acquisition make this area a worthwhile consideration for investors. Quick occupancy rates, supported by the high proportion of renters, minimize vacancy risks, ensuring a reliable cash flow. Additionally, the median income aligns well with the average rent, suggesting that tenants will have the financial means to maintain regular payments. Overall, ZIP 35218 presents a balanced opportunity for steady returns through rental income, especially for those willing to invest in properties that meet or exceed the FMR standards.

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.