Location: Huntsville, AL | Metro: Huntsville, AL MSA
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 | $1,680 |
| 1 Bedroom | $1,760 |
| 2 Bedrooms | $2,010 |
| 3 Bedrooms | $2,600 |
| 4 Bedrooms | $3,360 |
| 5 Bedrooms | $3,898 |
| 6 Bedrooms | $4,366 |
| 7 Bedrooms | $4,715 |
| 8 Bedrooms | $4,951 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $2,600 | $303,931 | 0.86% | C |
| 4BR | $3,360 | $419,146 | 0.8% | C |
| 5BR | $3,898 | $567,127 | 0.69% | D |
U.S. Census Bureau data (2024)
The analysis of ZIP code 35756 within the Huntsville, AL MSA reveals several key points for landlords and small-portfolio investors.
The first question addresses whether the rent math works. The Fair Market Rent (FMR) for ZIP 35756 in fiscal year 2024 is set at $1,870. In comparison, the market rent as indicated by the Zillow Observed Rental Index (ZORI) is currently at $1,700. This suggests that the FMR slightly overestimates the market conditions, offering a potential buffer for Section 8 landlords but also indicating that rents might be modestly higher than what tenants can afford through the program.
Secondly, regarding acquisition affordability, the median home value in ZIP 35756 is $386,835. With an average Days on Market (DOM) of 52 days and only 0.2% of homes experiencing a price cut, it appears that the real estate market is stable and competitive. Homes are selling relatively quickly without significant price adjustments, which could make acquiring properties for investment challenging due to their high value and limited price flexibility.
Finally, the tenant demand in ZIP 35756 is assessed based on its population and renter share. With a total population of 24,947 and a renter share of 17.4%, there is a notable demand for rental housing. However, this demand is not overwhelming, suggesting that landlords will need to manage their properties carefully to ensure occupancy rates remain high.
In conclusion, while the FMR provides a slight cushion above the market rent, making it somewhat favorable for landlords participating in the Section 8 program, the high median home values and short DOM indicate a competitive and potentially expensive acquisition environment. Tenant demand exists but is moderate, requiring landlords to maintain quality and competitive pricing to attract and retain renters. Overall, ZIP 35756 presents a balanced opportunity where careful management and strategic investment are essential for success.
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.