Section 8 Fair Market Rent (FMR) for ZIP 37115 - 2027

Investment Score for ZIP 37115

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,470
1 Bedroom	$1,530
2 Bedrooms	$1,670
3 Bedrooms	$2,140
4 Bedrooms	$2,600
5 Bedrooms	$3,016
6 Bedrooms	$3,378
7 Bedrooms	$3,648
8 Bedrooms	$3,830

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,530	$141,489	1.08%	B
2BR	$1,670	$243,042	0.69%	D
3BR	$2,140	$340,031	0.63%	D
4BR	$2,600	$439,830	0.59%	F
5BR	$3,016	$531,194	0.57%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 37115 (Nashville, TN) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 37115 is set by HUD for 2026, with the following rates: - 0BR: $1410 - 1BR: $1480 - 2BR: $1620 (which is 35.6% of the median household income) - 3BR: $2070 - 4BR: $2520 These figures represent the maximum amount that a Section 8 voucher holder can pay for rent in Nashville, TN. However, the actual rental market in 37115 suggests that these FMRs are significantly lower than what landlords might charge. For instance, the Zillow median price for a 2BR unit is $244,130, which translates into a monthly rental cost of approximately $1,260 if we assume a typical rental yield of 5%. This implies that the actual market rents are likely higher than the FMRs, making it challenging for voucher holders to find affordable housing. The price-to-FMR ratio for a 2BR unit is 12.6x, indicating that the market rents are about 12.6 times the FMR. Therefore, the gap between FMR and actual rents is substantial, placing significant constraints on voucher holders who must often seek units below the market rate or negotiate with landlords willing to accept the lower FMR rates. #### Affordability & Renter Profile ZIP code 37115 has a population of 40,615, with 56.7% of residents being renters. This high percentage of renters indicates a strong demand for rental properties in the area. The occupancy rate stands at 93.5%, suggesting that the rental market is relatively tight, with few vacant units available. Given the median household income of $54,566, the affordability of housing is a critical issue. The FMR for a 2BR unit is $1620, which is only 35.6% of the median income, highlighting that housing costs are manageable for those earning the median income. However, the majority of residents earning less than the median income would struggle to afford even the FMR rates, let alone market rates. This tight market and high renter percentage imply that there is a significant need for affordable housing options, particularly for low-income families. #### Investor Angle From an investor’s perspective, the ZIP code 37115 presents a mixed picture. The FMR rates are substantially lower than the market rates, which means that landlords who rely solely on Section 8 vouchers will face challenges in achieving positive cash flow. For example, a 2BR unit with a Zillow median price of $244,130 would have a monthly rental cost of around $1,260, but the FMR is $1620. If a landlord charges the FMR rate, they would be able to cover their mortgage payments and other expenses, but the profit margin would be slim. On the other hand, if they charge market rates, they risk losing potential tenants who are dependent on Section 8 vouchers. The investment grade for this ZIP code is moderate due to the high demand for rental properties and the tight market conditions. However, the reliance on Section 8 vouchers adds a layer of complexity, as landlords must navigate the requirements and limitations associated with accepting government assistance. The high renter percentage and occupancy rate indicate a stable tenant base, but the affordability issues suggest that there could be challenges in attracting and retaining tenants. #### Specific Actionable Insights 1. **Focus on Affordable Units**: Investors should focus on acquiring and developing units that are closer to the FMR rates. For instance, a 2BR unit priced at $1620 per month would be more attractive to voucher holders and could ensure a steady stream of tenants. This approach would also help mitigate the risk of vacancies and provide a more stable cash flow. 2. **Negotiate with Tenants**: Landlords should consider negotiating with voucher holders to find a balance between the FMR and market rates. Offering slightly above FMR rates could attract tenants while still allowing landlords to cover their costs and make a modest profit. For example, charging $1,700 for a 2BR unit would be a reasonable compromise, given the high demand and limited supply. 3. **Diversify Tenant Base**: To reduce dependency on Section 8 vouchers, landlords should diversify their tenant base. Attracting a mix of voucher holders and market-rate tenants can help stabilize cash flow and reduce the administrative burden associated with Section 8 programs. This could involve offering amenities or services that appeal to a broader range of renters. #### Bottom Line Given the high renter percentage and tight market conditions, ZIP code 37115 presents opportunities for investors focused on Section 8 housing. However, the challenge lies in balancing the need for affordable units with the financial viability of the investment. The recommendation for Section 8-focused investors is to **Buy** properties that align closely with FMR rates, especially 2BR units, as they offer the best chance of positive cash flow while meeting the needs of low-income families. Investors should also be prepared to negotiate with tenants and diversify their tenant base to ensure long-term stability and profitability. In summary, while the market is tight and there is a significant need for affordable housing, careful consideration of property acquisition and management strategies can lead to successful investments in this ZIP code.

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.