Location: Fayette County, AL | Metro: Walker County, 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 | $870 |
| 1 Bedroom | $880 |
| 2 Bedrooms | $1,060 |
| 3 Bedrooms | $1,350 |
| 4 Bedrooms | $1,400 |
| 5 Bedrooms | $1,624 |
| 6 Bedrooms | $1,819 |
| 7 Bedrooms | $1,965 |
| 8 Bedrooms | $2,063 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,350 | $238,726 | 0.57% | F |
U.S. Census Bureau data (2024)
The market analysis for Section 8 investors in ZIP code 35546, located in Fayette County, Alabama, reveals a favorable environment for cashflow generation. The HUD Fair Market Rent (FMR) for FY 2024 is set at $1130, which is significantly higher than the average market rent of $550 based on Census ACS data. This means that voucher tenants can cashflow at FMR levels, providing a substantial buffer for landlords and small-portfolio investors.
To further understand the investment potential, consider the median home value in the area, which stands at $184,555. With an average market rent of $550, the rent-to-price ratio is approximately 1%, indicating that rental income alone does not justify the purchase of a property based purely on rental yield. However, this low ratio suggests that the property values are relatively stable, offering a secure investment option.
The dynamics between renting and buying in ZIP 35546 do not significantly impact the decision-making process for investors, as there is no available data on the median Days on Market (DOM) or the percentage of price cuts. Despite this lack of specific data, the high FMR compared to the market rent provides a strong indication that properties in this area can be rented profitably to voucher holders without needing to be premium units.
The strongest investor angle in this market is cashflow. Given the disparity between the HUD FMR and the local market rent, landlords can expect consistent positive cashflow from Section 8 tenants, making it an attractive option for those seeking steady returns on their investments.
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.