Section 8 Fair Market Rent (FMR) for ZIP 37221 - 2027

Investment Score for ZIP 37221

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	$1,880
1 Bedroom	$1,960
2 Bedrooms	$2,130
3 Bedrooms	$2,740
4 Bedrooms	$3,320
5 Bedrooms	$3,851
6 Bedrooms	$4,313
7 Bedrooms	$4,658
8 Bedrooms	$4,891

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,960	$195,770	1%	B
2BR	$2,130	$310,399	0.69%	D
3BR	$2,740	$476,987	0.57%	F
4BR	$3,320	$655,501	0.51%	F
5BR	$3,851	$960,720	0.4%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 37221 (Nashville, TN) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 37221 in Nashville, TN, is set by HUD for 2026. For a two-bedroom unit, the FMR is $2200 per month. This amount represents 27.0% of the median household income in the area, which stands at $97,751. However, the actual rental market price for a two-bedroom unit is significantly higher. According to Zillow, the median price for a two-bedroom home in this ZIP code is $313,475, translating to a monthly rent of approximately $1140 based on typical mortgage payments. The price-to-FMR ratio of 11.9x indicates that the actual rental prices are much higher than the FMR. This means that tenants using Section 8 vouchers face significant constraints in finding affordable housing. The FMR is far below the actual market rent, making it challenging for voucher holders to secure units within their budget. For instance, a landlord renting a two-bedroom unit at the Zillow median price would need to charge around $2612 per month to break even on a mortgage, which is well above the $2200 FMR. #### Affordability & Renter Profile ZIP code 37221 has a population of 41,935, with 29.2% being renters. The occupancy rate is high at 94.6%, suggesting a tight rental market where demand exceeds supply. Given the median household income of $97,751, the majority of residents can afford higher rental rates, but those relying on Section 8 vouchers are likely to struggle. The high occupancy rate and relatively affluent population indicate that the area is attractive to both homeowners and renters. However, the disparity between the FMR and actual rental prices suggests that the market is not particularly affordable for low-income renters. The median household income is relatively high, which implies that most residents are not dependent on government assistance for housing. Therefore, the tight market conditions make it difficult for voucher holders to find suitable housing options. #### Investor Angle From an investor’s perspective, the ZIP code 37221 presents mixed dynamics. The FMR for a two-bedroom unit is $2200, but the actual market rent is much higher. If an investor were to purchase a property at the Zillow median price of $313,475 and rent it out at the FMR, they would likely face negative cash flow. Based on typical mortgage calculations, a monthly payment of around $1140 (assuming a 30-year fixed-rate mortgage at 4%) would be required, leaving a shortfall if rented at the FMR. However, the high occupancy rate and affluent population suggest strong demand for rental properties. Investors might consider targeting a niche market of middle-income renters who do not qualify for Section 8 but still require affordable housing. Alternatively, they could focus on properties that are slightly below the median price to ensure positive cash flow when rented at the FMR. The investment grade for this ZIP code is moderate due to the high cost of entry and the limited availability of units that can be rented profitably at the FMR. Investors should carefully evaluate their risk tolerance and financial goals before entering this market. #### Specific Actionable Insights 1. **Focus on Lower-Priced Properties**: Investors looking to target Section 8 voucher holders should focus on purchasing properties priced below the Zillow median. For example, a two-bedroom property priced at $260,000 would have a monthly mortgage payment of approximately $1040, allowing for a positive cash flow when rented at the FMR of $2200. 2. **Consider Multi-Family Units**: Given the high demand for rental properties, multi-family units might offer better opportunities for positive cash flow. A four-bedroom unit with an FMR of $3430 might be more feasible to rent out profitably, especially if the property is priced lower than the median. #### Bottom Line For Section 8-focused investors, the ZIP code 37221 presents a challenging environment due to the high cost of entry and the significant gap between FMR and actual rental prices. The recommendation is to **Skip** this ZIP code unless you can find properties priced substantially below the median. If you are willing to take on the risk and can secure properties at lower prices, then it might be worth considering, but only with a clear strategy to manage cash flow effectively. In summary, the tight market conditions and high prices make it difficult for Section 8 voucher holders to find affordable housing, and investors seeking positive cash flow will need to be selective in their acquisitions.

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.