Location: Birmingham-Hoover, AL | Metro: Birmingham-Hoover, AL HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $840 |
| 1 Bedroom | $900 |
| 2 Bedrooms | $970 |
| 3 Bedrooms | $1,230 |
| 4 Bedrooms | $1,380 |
| 5 Bedrooms | $1,601 |
| 6 Bedrooms | $1,793 |
| 7 Bedrooms | $1,936 |
| 8 Bedrooms | $2,033 |
U.S. Census Bureau data (2024)
The analysis of ZIP code 35254 within the Birmingham-Hoover, AL HUD Metro FMR area reveals critical insights for landlords and small-portfolio investors.
Regarding the rent math, the Family Monthly Income (FMI) figure of $970 for the fiscal year 2024 does not align favorably with the market conditions. The Fair Market Rent (FMR) at $970 is the benchmark used by HUD but without specific market rent data available, it's challenging to ascertain if the rent math works in practice. However, the FMR serves as a minimum threshold for rental income eligibility under Section 8, indicating that landlords should aim to keep rents below or at this level to attract Section 8 tenants.
Concerning acquisition affordability, the lack of specific data on median home values, days on market (DOM), and the percentage of homes needing price cuts hinders a comprehensive evaluation. Investors would need to research these metrics further to determine the feasibility of acquiring properties within this ZIP code at an affordable price. Without these figures, it's impossible to provide a definitive assessment of whether property acquisition is financially viable.
On the matter of tenant demand, ZIP 35254 hosts a population of 1,749. The percentage of renters in the area is not specified, which makes it difficult to gauge the potential tenant pool. Given the size of the population, it suggests a limited market, meaning that the demand for rental units might be lower compared to more densely populated areas. This could impact the number of potential Section 8 tenants available.
Verdict: While the FMR provides a clear guideline for rental pricing, the absence of key market data—specifically median home values, DOM, and the percentage of price cuts—renders the acquisition affordability question unresolved. Additionally, the small population size indicates a limited rental market, which could translate into fewer potential tenants. Therefore, landlords and investors must conduct thorough local market research to make informed decisions about investing in ZIP 35254. They should focus on understanding the local rental dynamics and the supply of Section 8 vouchers to ensure sustainable demand.
Data Sources: FMR data from HUD (2027). 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.