Location: Covington County, AL | Metro: Covington County, AL
| Unit Size | Monthly FMR |
|---|---|
| Studio | $720 |
| 1 Bedroom | $730 |
| 2 Bedrooms | $930 |
| 3 Bedrooms | $1,190 |
| 4 Bedrooms | $1,550 |
| 5 Bedrooms | $1,798 |
| 6 Bedrooms | $2,014 |
| 7 Bedrooms | $2,175 |
| 8 Bedrooms | $2,284 |
U.S. Census Bureau data (2024)
The ZIP code 36476 presents several challenges for potential Section 8 landlords. Firstly, the tenant turnover rate is likely to be higher due to the discrepancy between the market rent and the Fair Market Rent (FMR) set at $780 for fiscal year 2026. This can lead to increased costs associated with frequent tenant changes, including legal fees, cleaning expenses, and lost rent during the transition period.
Vacancy exposure is another significant risk. With an unknown number of days on the market (DOM), it's difficult to predict how long properties might remain vacant. Vacancies are particularly problematic because they represent a complete loss of rental income until a new tenant is found, which is crucial when operating on fixed income from vouchers.
The deferred maintenance exposure is also notable. Without specific data on the typical home value and median income in ZIP 36476, it's challenging to assess the financial capacity of landlords to maintain properties adequately. Section 8 requires properties to meet certain housing quality standards, and failing to do so can result in penalties or loss of tenancy, which would significantly impact the landlord's income.
However, these risks must be weighed against the strong demand for rentals in the area. The 69.6% renter share indicates a robust market for tenants, many of whom are likely to have Section 8 vouchers. High renter density typically translates into a higher likelihood of finding qualified voucher holders, thereby reducing the risk of vacancies and ensuring steady income.
In conclusion, despite the potential issues with tenant turnover, vacancy exposure, and maintenance requirements, the high renter density in ZIP 36476 suggests that there will be ample demand for Section 8 tenants. This makes the overall risk for a first-time Section 8 landlord in this area moderate.
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.