Location: Decatur, AL | Metro: Decatur, AL MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,090 |
| 1 Bedroom | $1,130 |
| 2 Bedrooms | $1,330 |
| 3 Bedrooms | $1,710 |
| 4 Bedrooms | $2,210 |
| 5 Bedrooms | $2,564 |
| 6 Bedrooms | $2,872 |
| 7 Bedrooms | $3,102 |
| 8 Bedrooms | $3,257 |
U.S. Census Bureau data (2024)
The median home value in ZIP 35775 is $74,200, significantly lower than the national average of $303,400. This low valuation presents an opportunity for Section 8 investors.
For a two-bedroom property, the Fair Market Rent (FMR) for Section 8 is $1240 per month (FY 2024). Annually, this amounts to $14,880. Given the median home value of $74,200, the implied gross yield for a Section 8 property is approximately 20.08%. This calculation is derived from dividing the annual rental income by the property's value.
Unfortunately, there is no specific data available for the market rent in ZIP 35775. However, considering the low median home value and the typical rental trends in the area, it is unlikely that market rents would be significantly higher than the Section 8 FMR. Therefore, the gross yield for market rents would likely be lower than the Section 8 scenario.
The 5.7% renter density suggests that the demand for rental properties, including those under Section 8, is relatively modest. Additionally, the median days on market (DOM) data is not available, which could provide further insight into how quickly properties are rented out. Despite these limitations, the high gross yield of the Section 8 scenario makes it a more attractive option for investors looking for steady, government-backed rental income.
In conclusion, while the lack of specific market rent data limits a direct comparison, the Section 8 program offers a clear, high-gross-yield investment opportunity in ZIP 35775. Landlords and small-portfolio investors should consider the stability and predictability of Section 8 rents when evaluating potential investments.
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.