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 | $1,190 |
| 1 Bedroom | $1,260 |
| 2 Bedrooms | $1,430 |
| 3 Bedrooms | $1,850 |
| 4 Bedrooms | $2,390 |
| 5 Bedrooms | $2,772 |
| 6 Bedrooms | $3,105 |
| 7 Bedrooms | $3,353 |
| 8 Bedrooms | $3,521 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,430 | $207,300 | 0.69% | D |
| 3BR | $1,850 | $293,311 | 0.63% | D |
| 4BR | $2,390 | $401,397 | 0.6% | F |
| 5BR | $2,772 | $514,294 | 0.54% | F |
U.S. Census Bureau data (2024)
The potential risks for a Section 8 landlord in ZIP code 35803, Huntsville, AL, include significant tenant turnover due to the disparity between the market rent of $1,555 and the Fair Market Rent (FMR) of $1,350 for fiscal year 2024. This difference can lead to tenants seeking higher-paying jobs or moving to areas where their vouchers cover a larger portion of the rent. Additionally, there is a notable vacancy exposure risk with an average Days on Market (DOM) of 21 days, indicating that properties may remain vacant longer than expected, reducing cash flow.
The deferred maintenance exposure is another critical concern, given the typical home value of $316,824 and a median household income of $100,846. Landlords must be prepared to invest in property upkeep since tenants receiving Section 8 assistance might not have the financial means to address maintenance issues promptly. The lower median income suggests that tenants may struggle to pay for non-rent-related expenses, such as utilities and repairs, which could fall on the landlord.
However, these risks are mitigated by the high renter share of 16.6%, which typically correlates with increased demand for housing vouchers. High renter density often indicates a robust pool of potential tenants, reducing the likelihood of extended vacancies. Furthermore, the local rental market's dynamics suggest that landlords can expect a steady stream of applicants, easing the burden of finding suitable tenants.
In conclusion, the investment risk for a first-time Section 8 landlord in ZIP code 35803 is moderate.
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.