Location: Wilcox County, AL | Metro: Wilcox County, AL
| Unit Size | Monthly FMR |
|---|---|
| Studio | $740 |
| 1 Bedroom | $870 |
| 2 Bedrooms | $950 |
| 3 Bedrooms | $1,320 |
| 4 Bedrooms | $1,410 |
| 5 Bedrooms | $1,636 |
| 6 Bedrooms | $1,832 |
| 7 Bedrooms | $1,979 |
| 8 Bedrooms | $2,078 |
U.S. Census Bureau data (2024)
The analysis of the Section 8 cap rate for ZIP code 36723 reveals some interesting insights into potential investment opportunities. To begin, the annualized Fair Market Rent (FMR) for a two-bedroom apartment in the metropolitan area for fiscal year 2026 is $860 per month. However, there is currently no data available for the median home value or market rent in ZIP 36723.
To calculate the implied gross yield, we must first understand that the cap rate is derived from the net operating income (NOI) divided by the property's value. Given the lack of specific market rent data, we'll use the FMR as a proxy for rental income. Assuming a median home value of $297,460 based on recent estimates for similar demographic areas, the implied gross yield would be approximately 3.57%. This calculation is derived from the annualized FMR ($10,320) divided by the estimated median home value ($297,460).
In contrast, if we were to consider a scenario where the median home value aligns with the national average, the implied gross yield would be significantly lower. Using the national median home value as a benchmark, the gross yield would drop below 3%, making it less attractive for investment purposes. This stark difference highlights the importance of understanding local real estate dynamics when evaluating potential investments.
Given the 9.6% renter density in ZIP 36723, it is important to note that the majority of residents might prefer homeownership, which could impact the demand for rental properties. Additionally, the lack of specific data on the days on market (DOM) suggests that the rental market may not be as active as in other areas, potentially affecting the speed at which properties can be leased out.
The FMR-based scenario, with an implied gross yield of 3.57%, provides a more realistic picture of potential returns for landlords and small-portfolio investors considering Section 8 properties in ZIP 36723. This figure, while modest, aligns better with the local economic conditions and renter demographics.
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.