Location: Marion County, AL | Metro: Fayette County, AL
| Unit Size | Monthly FMR |
|---|---|
| Studio | $730 |
| 1 Bedroom | $830 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,390 |
| 4 Bedrooms | $1,620 |
| 5 Bedrooms | $1,879 |
| 6 Bedrooms | $2,104 |
| 7 Bedrooms | $2,272 |
| 8 Bedrooms | $2,386 |
U.S. Census Bureau data (2024)
A decision tree for evaluating whether to invest in ZIP code 35594 for Section 8 properties hinges on three key questions:
1) Does the Fair Market Rent (FMR) of $850 cover the debt service on a property priced at $173,205?
Yes. The FMR of $850 is sufficient to cover the average debt service costs. Assuming an average mortgage rate of 4.5%, the annual debt service would be approximately $7,800, or $650 per month. Thus, the FMR comfortably exceeds this amount, making the property financially viable under Section 8 guidelines.
No. This scenario would not apply as the FMR of $850 does exceed the necessary monthly debt service payment for a property of that value.
It depends. Not applicable in this case given the clear margin between FMR and debt service requirements.
2) How does the market rent of $727 compare to the FMR?
Above. Not applicable as the market rent of $727 is below the FMR of $850.
At. Not applicable as the market rent and FMR do not match.
Below. The market rent of $727 is lower than the FMR of $850, indicating a potential opportunity to rent out properties at a higher rate if you qualify for Section 8 vouchers. This could provide a buffer against market fluctuations and ensure steady income.
3) Is there enough demand with 21.9% renters and an unknown number of days on the market (DOM)?
Yes. With 21.9% of the population renting, there is a significant portion of the market that could potentially benefit from Section 8 housing. However, the lack of data on days on the market (DOM) means we cannot fully assess the speed at which rental units are being filled. To make a definitive judgment, additional research into the local rental market's vacancy rates and DOM trends would be required.
No. Not applicable based on the available percentage of renters.
It depends. Given the 21.9% of the population renting, demand appears present. Yet, without knowing the DOM, it is difficult to determine how quickly units turn over and whether there is sustained interest in rental properties. If DOM is low, it suggests strong demand and rapid turnover, which would support a positive investment decision. Conversely, high DOM might indicate slower demand and longer periods before achieving occupancy.
To summarize, ZIP code 35594 presents a financially viable option for Section 8 investments due to the FMR exceeding debt service costs and market rents being below FMR. However, the decision ultimately hinges on the demand dynamics, which require further investigation into DOM trends to confirm sustained interest among potential tenants.
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.