Location: Montgomery, AL | Metro: Montgomery, AL MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $820 |
| 1 Bedroom | $840 |
| 2 Bedrooms | $960 |
| 3 Bedrooms | $1,240 |
| 4 Bedrooms | $1,430 |
| 5 Bedrooms | $1,659 |
| 6 Bedrooms | $1,858 |
| 7 Bedrooms | $2,007 |
| 8 Bedrooms | $2,107 |
U.S. Census Bureau data (2024)
In ZIP code 36047, the economics of Section 8 housing can be clearly defined using the SAFMR (Small Area Fair Market Rent) rates provided by HUD. For a two-bedroom apartment, the SAFMR for FY 2024 is set at $940. This figure is specific to this ZIP code and reflects the local rental market conditions.
The SAFMR rate does not directly represent the local market rent, which is currently unavailable. However, it's important to understand that the SAFMR is used to determine the maximum amount a landlord can charge for rent under the Section 8 program. If the local market rent is higher than $940, landlords must accept the lower SAFMR rate to participate in the program.
A voucher payment under Section 8 consists of two parts: the tenant's portion and the government subsidy. The tenant is generally responsible for paying 30% of their adjusted income towards rent. The government then covers the difference between the tenant's contribution and the SAFMR rate, up to the maximum allowed. In addition, there are utility allowances which vary but typically add a modest amount to the total reimbursement.
To illustrate, let's assume a tenant with an adjusted income of $1,500 per month. Their contribution would be 30% of this amount, or $450. The remaining $490 would come from the government subsidy, making the total reimbursement $940. If the local market rent exceeds $940, the landlord will receive only up to this amount, creating a reimbursement gap. Conversely, if the local market rent is below $940, the landlord might benefit from a surplus.
Given the SAFMR rate of $940 for a two-bedroom apartment, landlords should expect a reimbursement that closely matches this figure once the tenant's portion and any applicable utility allowances are accounted for. Without specific local market rent data, we cannot quantify the exact reimbursement gap or surplus, but landlords should prepare for a reimbursement that does not exceed the SAFMR rate.
For landlords and small-portfolio investors, participating in Section 8 means ensuring that the rent charged does not exceed the SAFMR rate of $940 for a two-bedroom unit in ZIP 36047. This ensures compliance with the program and provides a stable, though possibly lower, income stream compared to the open market. The decision to participate should be based on understanding these economic realities and whether the reimbursement meets the landlord's financial needs.
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.