Location: Covington County, AL | Metro: Dothan, AL HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $730 |
| 1 Bedroom | $730 |
| 2 Bedrooms | $920 |
| 3 Bedrooms | $1,230 |
| 4 Bedrooms | $1,350 |
| 5 Bedrooms | $1,566 |
| 6 Bedrooms | $1,754 |
| 7 Bedrooms | $1,894 |
| 8 Bedrooms | $1,989 |
U.S. Census Bureau data (2024)
The Section 8 market analysis for ZIP code 36477 in Covington County, Alabama reveals a favorable environment for investors. The Fair Market Rent (FMR) set by HUD for FY 2024 is $860, which is significantly higher than the market rent reported by the Census ACS at $764. This indicates that voucher tenants will generally cashflow positively at the FMR, making this area attractive for landlords who can leverage the higher subsidy rates.
To further evaluate the investment potential, consider the median home value in ZIP 36477, which stands at $148,277. Using this figure, we can calculate a rent-to-price ratio. Dividing the HUD FMR of $860 by the median home value yields a ratio of approximately 0.58%, suggesting a relatively low cost of ownership compared to rental income. This ratio is particularly appealing when considering the long-term benefits of rental properties over homeownership, given the current market conditions.
In terms of the days on market (DOM) and the percentage of homes that have been listed with a price cut, these metrics are not available for ZIP 36477. However, the absence of these data points does not diminish the attractiveness of the area for investors. The key factor remains the positive cash flow potential from voucher tenants, who can afford rents at the FMR level without the need for premium units.
The strongest investor angle in ZIP 36477 is the potential for cashflow. Given the disparity between the HUD FMR and the actual market rent, landlords can expect steady, positive cash flow from Section 8 tenants, making it an excellent choice for those focused on generating reliable rental income.
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.