Location: Nashville-Davidson--Murfreesboro--Franklin, TN | Metro: Nashville-Davidson--Murfreesboro--Franklin, TN 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 | $1,070 |
| 1 Bedroom | $1,110 |
| 2 Bedrooms | $1,210 |
| 3 Bedrooms | $1,550 |
| 4 Bedrooms | $1,880 |
| 5 Bedrooms | $2,181 |
| 6 Bedrooms | $2,443 |
| 7 Bedrooms | $2,638 |
| 8 Bedrooms | $2,770 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,210 | $318,965 | 0.38% | F |
| 3BR | $1,550 | $418,352 | 0.37% | F |
| 4BR | $1,880 | $533,047 | 0.35% | F |
U.S. Census Bureau data (2024)
A skeptical investor looking into ZIP 37080, located in Nashville, Tennessee, might have several concerns regarding the feasibility of investing in rental properties under the Section 8 program. Let's address these points directly.
Will FMR $1270 (zip FY 2024) cover the mortgage on a $408,826 home?
The Fair Market Rent (FMR) for ZIP 37080 in fiscal year 2024 is set at $1270 per month. To determine if this will sufficiently cover the mortgage on a home priced at $408,826, we need to consider the typical mortgage rates and terms. Assuming a standard 30-year fixed-rate mortgage at an interest rate of 4%, the monthly payment would be approximately $1980. This amount is higher than the FMR, indicating that relying solely on Section 8 payments would leave a significant shortfall. However, it's important to note that property taxes and insurance are also factors, and these can sometimes be lower in certain areas. Additionally, investors often seek properties below the median price to ensure profitability.
Is there enough renter demand at 11.7%?
The rental vacancy rate for ZIP 37080 stands at 11.7%. While this figure is higher than the national average, it does not necessarily indicate low demand. In fact, a 11.7% vacancy rate suggests a moderate level of competition among landlords. The key is to focus on properties that meet the needs of tenants seeking Section 8 housing, such as location, amenities, and condition. With a well-maintained property in a desirable area, an investor should be able to attract tenants despite the vacancy rate. It's also worth noting that Nashville's population growth and economic activity contribute to a steady demand for rental properties, which can help mitigate risks associated with high vacancy rates.
Will vouchers keep pace with $1,050 market rents?
The market rent for ZIP 37080 is reported at $1,050 per month. Given that the FMR is $1270, vouchers are designed to cover up to the FMR, meaning they should adequately compensate for the market rent. However, the challenge lies in ensuring that voucher holders can afford the difference between the FMR and the market rent, especially if the landlord sets a higher rent. Historically, the Housing Choice Voucher program has adjusted its payments to reflect changes in the housing market, but local conditions and administrative decisions can influence how closely vouchers align with actual market rents. Therefore, while the current FMR covers the market rent, future adjustments depend on various factors outside of the immediate data provided.
In conclusion, while the data presents some challenges, particularly with the mortgage coverage and the need for careful property selection, the overall environment in ZIP 37080 supports a viable investment opportunity for those willing to navigate the specifics of the Section 8 program.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.