Location: Wilcox County, AL | Metro: Wilcox County, AL
| Unit Size | Monthly FMR |
|---|---|
| Studio | $720 |
| 1 Bedroom | $850 |
| 2 Bedrooms | $920 |
| 3 Bedrooms | $1,280 |
| 4 Bedrooms | $1,370 |
| 5 Bedrooms | $1,589 |
| 6 Bedrooms | $1,780 |
| 7 Bedrooms | $1,922 |
| 8 Bedrooms | $2,018 |
The analysis for ZIP code 36753 reveals some limitations due to incomplete data, but we can still provide a preliminary outlook on the Section 8 cap rate scenario.
The Fair Market Rent (FMR) for a 2-bedroom apartment in ZIP 36753 for fiscal year 2026 is set at $910 annually. This figure represents the government's benchmark for rental assistance under the Section 8 program. However, without the specific median home value and current market rents for the area, we cannot calculate an exact cap rate or gross yield. Nonetheless, we can discuss the implications of these figures.
In the case where the market rent equals the FMR, the annualized income would be $910 per unit. Given that the median home value is not available, it's challenging to derive the property value needed to calculate the gross yield directly. However, if we assume a typical property value for a 2-bedroom unit in this ZIP code, we could estimate the gross yield. For instance, if a 2-bedroom unit were valued at $120,000, the gross yield would be approximately 7.6% ($910 / $120,000).
On the other hand, if market rents were higher than the FMR, the gross yield would decrease proportionally to the increased rent. For example, if the market rent were $1,000 annually, the gross yield based on the same property value would drop to about 8.3%. This scenario suggests a lower gross yield compared to the Section 8 rent scenario, indicating that properties rented through the Section 8 program might offer a higher return relative to their value.
The implied gross yield comparison between the two scenarios is concrete: Section 8 provides a consistent and potentially higher gross yield when market rents are high or unknown. However, the lack of data on renter density and days on market (DOM) makes it difficult to determine which scenario is more realistic. Typically, a higher renter density and shorter DOM indicate a stronger rental market, which might support higher market rents. Conversely, lower density and longer DOM could suggest a reliance on Section 8 subsidies for tenant attraction.
To proceed with investment decisions, landlords and small-portfolio investors should seek out local real estate trends, property values, and tenant demand specifics for ZIP 36753 to refine these estimates and understand the actual potential returns.
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.