Location: Daphne-Fairhope-Foley, AL | Metro: Daphne-Fairhope-Foley, 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 | $1,090 |
| 1 Bedroom | $1,250 |
| 2 Bedrooms | $1,390 |
| 3 Bedrooms | $1,820 |
| 4 Bedrooms | $2,230 |
| 5 Bedrooms | $2,587 |
| 6 Bedrooms | $2,897 |
| 7 Bedrooms | $3,129 |
| 8 Bedrooms | $3,285 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,390 | $217,299 | 0.64% | D |
| 3BR | $1,820 | $308,263 | 0.59% | F |
| 4BR | $2,230 | $364,550 | 0.61% | D |
U.S. Census Bureau data (2024)
The median income in ZIP code 36549, Lillian, AL, stands at $63,019. This figure places significant constraints on the average household's ability to afford the market rate rent of $927, as reported by the Census Bureau's American Community Survey (ACS). To put this into perspective, the median income suggests that a substantial portion of the population may struggle to meet the market rate without financial strain.
Comparatively, the Federal Market Rent (FMR) standard for ZIP 36549 in fiscal year 2024 is set at $1,200. This is notably higher than the market rate and represents the maximum amount that housing authorities will pay landlords participating in the Section 8 program. Given that the market rate is already challenging for many residents, the FMR of $1,200 provides a buffer for landlords who might be concerned about the financial viability of their properties.
With only 9.4% of the 5,622 population being renters, competition among landlords is likely to be fierce. The limited rental market means that attracting and retaining tenants is critical. Landlords must consider the affordability gap between the median income and both the market rate and FMR when setting their rental prices and deciding whether to accept Section 8 vouchers.
The takeaway for landlords considering their strategy is clear: accepting Section 8 vouchers can offer a stable source of income, particularly if the market rate is unattainable for many potential tenants. Vouchers provide a guaranteed payment up to $1,200, which can be more reliable than relying solely on market-rate rents that may deter a significant portion of the local population. For those focused on maximizing short-term profits, however, sticking with cash-paying tenants who can afford the $927 market rate might still be viable, albeit in a smaller pool of the total population.
Ultimately, landlords in ZIP 36549 should weigh the benefits of voucher stability against the risks of reduced tenant pool size and increased competition for market-rate tenants. A balanced approach might involve offering a mix of units at different price points, including some that are voucher-friendly, to cater to the diverse needs of the community while ensuring a steady stream of income.
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.