Location: Johnson County, TN | Metro: Johnson City, 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 | $800 |
| 1 Bedroom | $880 |
| 2 Bedrooms | $1,020 |
| 3 Bedrooms | $1,300 |
| 4 Bedrooms | $1,400 |
| 5 Bedrooms | $1,624 |
| 6 Bedrooms | $1,819 |
| 7 Bedrooms | $1,965 |
| 8 Bedrooms | $2,063 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,020 | $299,497 | 0.34% | F |
| 3BR | $1,300 | $457,035 | 0.28% | F |
U.S. Census Bureau data (2024)
The Fair Market Rent (FMR) for ZIP code 37640 in Butler, Tennessee, for fiscal year 2024 is set at $970. This figure represents the maximum amount that a landlord can receive from the Housing Choice Voucher program, commonly known as Section 8, for a given unit. It is important to note that this is not the actual rent you will charge your tenants; it is the benchmark against which voucher payments are calculated.
In comparison, the average rent for the area according to recent Census data (ACS) is $687. This discrepancy indicates that the FMR is higher than the local average, which can be beneficial for landlords participating in the Section 8 program as they are likely to receive a higher payment for their units than the market average.
The 14.2% share of renters in Butler, TN, suggests that there is a moderate level of demand for rental properties in the area. While this percentage is not exceptionally high, it does indicate that a significant portion of the population relies on renting, providing a steady stream of potential tenants for your property.
When considering the acquisition of a rental property in this ZIP code, the median home value of $298,774 should factor into your decision-making process. This price point can help you determine whether the investment aligns with your financial goals and if the potential income from the Section 8 program justifies the initial outlay.
Before proceeding with your first Section 8 rental, ensure that you verify the condition of the property against the Housing Quality Standards (HQS). These standards are a set of minimum requirements that all Section 8 properties must meet to ensure they are safe and habitable for tenants. Failure to comply with these standards can result in penalties and loss of rental income.
By understanding the FMR and ensuring your property meets the necessary standards, you can make an informed decision about entering the Section 8 market in Butler, TN.
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.