Location: Clarksville, TN | Metro: Clarksville, TN-KY HUD Metro FMR Area
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 | $1,100 |
| 1 Bedroom | $1,100 |
| 2 Bedrooms | $1,350 |
| 3 Bedrooms | $1,850 |
| 4 Bedrooms | $2,260 |
| 5 Bedrooms | $2,622 |
| 6 Bedrooms | $2,937 |
| 7 Bedrooms | $3,172 |
| 8 Bedrooms | $3,331 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,350 | $208,833 | 0.65% | D |
| 3BR | $1,850 | $299,919 | 0.62% | D |
| 4BR | $2,260 | $360,892 | 0.63% | D |
| 5BR | $2,622 | $405,875 | 0.65% | D |
U.S. Census Bureau data (2024)
The 37040 ZIP code covers much of Clarksville, Tennessee, a city defined by its deep ties to Fort Campbell. This area is a classic military town, characterized by a steady flow of defense personnel and government contractors. A major economic anchor here is the Fort Campbell Army post, which sits on the border and drives significant demand for housing, as thousands of service members and their families seek off-base rentals. The neighborhood mix ranges from established suburban subdivisions to newer developments catering to this transient population, offering landlords a tenant base accustomed to standard housing requirements and reliable income.
From a financial perspective, the data reveals a tight spread for voucher units. The FY2024 HUD SAFMR for a 2-bedroom unit in 37040 is set at $1,240. When compared to the current market rent of $1,356, there is a gap of $116, meaning the voucher payment trails the open market by about 8.6%. Investors should note the median home value sits at $304,937, while the median 2BR sale price is significantly lower at $208,802. With homes taking a median of 96 days to sell, the area suggests a slightly softer turnover pace, requiring investors to be patient with acquisitions but rewarded by lower entry prices for multi-bedroom assets.
The demand fundamentals here are robust, supported by a 42.2% renter share and a median household income of $67,745. While local schools like those in the Clarksville-Montgomery County School System generally perform well, the primary driver is institutional stability from the military presence rather than traditional school-district appeal. Public transit options are limited, reinforcing the need for properties with parking, but the proximity to post commissaries and amenities ensures consistent desirability for families utilizing housing vouchers who need to remain close to the base for work and daily needs.
The Section 8 verdict for 37040 leans toward stability over immediate maximization of cash flow. Although the $116 gap between market rent and the 2BR SAFMR is notable, the lower median 2BR sales price of $208,802 allows for reasonable cap rates even with the lower subsidy ceiling. The strongest investor angle here is the reliability of the military-backed tenant pool; the high renter percentage and the economic buffer provided by Fort Campbell create a safety net that mitigates vacancy risk, making this a solid hold for long-term appreciation rather than aggressive monthly yield.
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.