Section 8 Fair Market Rent (FMR) for ZIP 36120 - 2027

FY 2027 Fair Market Rent Rates

To determine if you should invest in ZIP 36120 for Section 8 properties, follow this decision tree based on the available data:

1) Does the Fair Market Rent (FMR) of $1080 cover the debt service on a property?

• Yes: If the FMR of $1080 is sufficient to cover the mortgage payments and other expenses associated with owning a rental property, then proceed to the next question.
• No: Do not purchase a property in ZIP 36120 for Section 8 use if the FMR cannot cover your debt service. The rent will not be high enough to sustain the financial obligations of ownership.

2) Is the market rent above, at, or below the FMR?

• Above FMR: If the market rent exceeds $1080, it indicates that there is potential for higher returns outside of Section 8. Consider whether the benefits of participating in the Section 8 program outweigh the opportunity cost of renting at market rates.
• At FMR: If the market rent is exactly $1080, the property will be competitive with other rentals in the area. Proceed to evaluate the demand for rentals.
• Below FMR: If the market rent is below $1080, Section 8 may offer a more stable income source compared to market-rate tenants. However, this also suggests that the area may have lower overall rental demand.

3) Are the rental demand indicators strong enough?

• It Depends: Without specific percentages of renters and days on the market (DOM), it's difficult to provide a definitive answer. Evaluate the percentage of renters and the average DOM to gauge demand. A higher percentage of renters and shorter DOM suggest stronger demand for rental properties in ZIP 36120.

Note: The data provided does not include market rent, the percentage of renters, or the average DOM. To make an informed decision, you must gather these figures to complete the analysis.

Data Sources: FMR data from HUD (2027).

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.