Location: Cleveland, TN | Metro: Cleveland, TN MSA
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 | $860 |
| 1 Bedroom | $940 |
| 2 Bedrooms | $1,230 |
| 3 Bedrooms | $1,540 |
| 4 Bedrooms | $1,620 |
| 5 Bedrooms | $1,879 |
| 6 Bedrooms | $2,104 |
| 7 Bedrooms | $2,272 |
| 8 Bedrooms | $2,386 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,230 | $254,129 | 0.48% | F |
| 3BR | $1,540 | $320,472 | 0.48% | F |
| 4BR | $1,620 | $391,889 | 0.41% | F |
U.S. Census Bureau data (2024)
The Section 8 housing analysis for ZIP code 37323 in Cleveland, TN, highlights a significant disparity between the Fair Market Rent (FMR) and the market rent. For fiscal year 2024, the FMR is set at $1170, while the actual market rent, as measured by ZORI, stands at $1680. This means that landlords could potentially rent their properties for $510 more per month above the FMR rate. In percentage terms, the market rent exceeds the FMR by approximately 43.6%, calculated as ($1680 - $1170) / $1170 * 100.
The gap between FMR and market rent underscores the financial challenges faced by landlords who choose to accept Section 8 housing vouchers. By accepting vouchers at the FMR rate, landlords receive $1170 per month, which is significantly lower than the $1680 they could potentially earn from the open market. This discrepancy can lead to reduced profit margins, especially when considering the typical costs associated with maintaining rental properties.
In the context of Cleveland, TN, where 19.7% of residents are renters, and the median home value is $298,566, the decision to participate in the Section 8 program must be weighed against the broader economic landscape. With a median income of $68,768, many residents may find themselves reliant on housing assistance to afford living in the area. Landlords should carefully consider these factors when deciding whether to rent at the FMR rate or seek higher-paying open-market tenants.
Accepting Section 8 tenants can still be a viable strategy for some landlords, particularly those focused on long-term stability and steady cash flow. However, it is important to note that the financial benefits of renting to voucher holders are limited compared to the potential earnings from market-rate rentals. The difference of $510 per month represents a substantial opportunity cost, which landlords must factor into their investment decisions.
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.