Location: Coffee County, TN | Metro: Coffee County, TN
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 | $890 |
| 1 Bedroom | $950 |
| 2 Bedrooms | $1,110 |
| 3 Bedrooms | $1,480 |
| 4 Bedrooms | $1,490 |
| 5 Bedrooms | $1,728 |
| 6 Bedrooms | $1,935 |
| 7 Bedrooms | $2,090 |
| 8 Bedrooms | $2,195 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,110 | $204,876 | 0.54% | F |
| 3BR | $1,480 | $331,727 | 0.45% | F |
| 4BR | $1,490 | $418,084 | 0.36% | F |
U.S. Census Bureau data (2024)
The analysis of the Section 8 program in ZIP code 37355, which encompasses Manchester, TN, reveals a significant disparity between the Fair Market Rent (FMR) and the actual market rent. The FMR for the metro area for fiscal year 2026 is set at $970, while the Zillow Observed Rent Index (ZORI), which reflects the current market conditions, stands at $1,748. This means that the gap between the two figures is $778 per month, representing a 80.2% difference.
Given that the FMR is lower than the market rent, landlords and small-portfolio investors must consider the implications of accepting housing vouchers that pay below the open-market rates. The average market rent in Manchester, TN, is considerably higher than what the Section 8 program will reimburse, potentially leading to financial losses if not managed properly.
In Manchester, TN, where 30.1% of residents are renters, the median home value is $325,407 and the median income is $63,357. These figures suggest a relatively stable housing market but also highlight the challenge faced by low-income families who rely on Section 8 vouchers. Landlords accepting these vouchers should be aware that they are likely to receive less than the market rate, which could impact their overall rental yield.
To put this into perspective, if a landlord has a property valued at the median home price, the monthly mortgage payment alone would likely exceed the FMR. Adding maintenance costs, insurance, and other expenses further increases the financial burden of renting below market rates. Therefore, the decision to participate in the Section 8 program should be made with a thorough understanding of the financial dynamics involved.
Landlords considering Section 8 properties in Manchester, TN, need to weigh the benefits of a guaranteed tenant against the lower rental income. While the program provides stability through government-backed payments, it also requires adherence to strict guidelines and regulations, which can affect the operational flexibility of the investment.
Investors looking to maximize returns in this area should focus on the broader rental market, where the potential for higher yields exists due to the $1,748 average market rent. However, for those interested in social impact investing or stabilizing the local housing market, participating in the Section 8 program can still be a viable option, despite the financial gap.
The gap between the FMR and market rent underscores the economic challenges faced by both low-income families and landlords in Manchester, TN. It highlights the need for careful consideration when deciding whether to accept Section 8 vouchers, given the substantial difference in rental rates.
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.