Location: Montgomery, AL | Metro: Montgomery, 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 | $1,210 |
| 1 Bedroom | $1,230 |
| 2 Bedrooms | $1,410 |
| 3 Bedrooms | $1,810 |
| 4 Bedrooms | $2,090 |
| 5 Bedrooms | $2,424 |
| 6 Bedrooms | $2,715 |
| 7 Bedrooms | $2,932 |
| 8 Bedrooms | $3,079 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,810 | $248,684 | 0.73% | D |
| 4BR | $2,090 | $346,542 | 0.6% | D |
| 5BR | $2,424 | $494,883 | 0.49% | F |
U.S. Census Bureau data (2024)
The potential pitfalls for a Section 8 landlord in ZIP code 36066 are significant. First, tenant turnover can be a major issue, especially when comparing the market rent of $1,961 to the Federal Market Rent (FMR) of $1,330 for FY 2024. This discrepancy indicates that tenants might struggle to afford higher rents, leading to frequent moves and increased vacancy rates. With an average Days on Market (DOM) of 24 days, landlords must be prepared for periods of vacancy, which can result in lost rental income and additional costs for marketing and leasing.
Second, there is a risk of deferred maintenance due to the relatively low median income of $86,278 compared to the typical home value of $288,235. Landlords may face challenges in keeping properties up to standard without incurring substantial out-of-pocket expenses. The financial strain could lead to neglect, which in turn can cause property values to decline over time.
However, these risks are tempered by the high proportion of renters in the area, with 36.6% of residents being renters. High renter density often correlates with greater demand for housing vouchers, which can stabilize cash flow and reduce the risk of vacancy. Additionally, the presence of many renters suggests a vibrant local rental market, which can help mitigate some of the risks associated with tenant turnover and maintenance.
Verdict: Moderate risk for a first-time Section 8 landlord.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.