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 | $1,030 |
| 1 Bedroom | $1,100 |
| 2 Bedrooms | $1,200 |
| 3 Bedrooms | $1,510 |
| 4 Bedrooms | $1,690 |
| 5 Bedrooms | $1,960 |
| 6 Bedrooms | $2,195 |
| 7 Bedrooms | $2,371 |
| 8 Bedrooms | $2,490 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,200 | $43,273 | 2.77% | A+ |
| 3BR | $1,510 | $67,976 | 2.22% | A+ |
U.S. Census Bureau data (2024)
The Fair Market Rent (FMR) for ZIP code 35221 in Birmingham, Alabama, for fiscal year 2024 is set at $1130. This figure represents the maximum amount that a landlord can charge for a Section 8 rental unit in this area. It's important to note that this is the payment standard established by HUD, and it does not necessarily reflect the actual rent you will receive. Landlords often negotiate rents below the FMR to ensure occupancy.
In comparison, the average rent in ZIP 35221 based on Census American Community Survey (ACS) data is $1,018. This suggests that the FMR is slightly above the market rate, which could be beneficial for landlords participating in the Section 8 program. The difference between the FMR and the average rent indicates a potential buffer for landlords, ensuring they can cover costs and maintain profitability.
The 39.8% renter share in the area highlights a significant demand for rental properties. This high percentage of renters signals a robust market for those looking to invest in rental housing, including Section 8 properties. However, it also implies competition among landlords for tenants, so setting a competitive price under the FMR is crucial.
When considering the acquisition cost of a property, the median household income in ZIP 35221 is $62,465. This figure helps to gauge the financial stability of potential tenants and the overall economic health of the neighborhood. A higher median income can support better tenant screening and potentially lower vacancy rates, but it also suggests that the area might attract a mix of tenants, some who may qualify for Section 8 assistance.
Before making your investment decision, verify that the property meets all HUD and local housing quality standards. These requirements ensure that the property is safe and habitable for tenants, and compliance is mandatory for participation in the Section 8 program. Failure to meet these standards can result in penalties and loss of rental income.
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.