Location: Johnson City, 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 | $810 |
| 2 Bedrooms | $1,020 |
| 3 Bedrooms | $1,260 |
| 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 | $192,390 | 0.53% | F |
| 3BR | $1,260 | $272,135 | 0.46% | F |
| 4BR | $1,400 | $319,375 | 0.44% | F |
U.S. Census Bureau data (2024)
The potential pitfalls of investing in Section 8 housing in ZIP code 37650, Erwin, TN, include significant tenant turnover. With the market rent set at $722, which is below the Fair Market Rent (FMR) of $910 for FY 2024, landlords may face higher turnover rates as tenants seek better rental deals. This can lead to increased administrative costs and time spent on finding new tenants.
Vacancy exposure is another concern. The days on market (DOM) for properties in this area is not available, which suggests that there might be periods where units remain unoccupied longer than expected. An extended period without a tenant can significantly impact cash flow and profitability.
Deferred maintenance poses a risk due to the relatively low median income of $50,654 compared to the typical home value of $222,814. Landlords must be prepared to cover maintenance and repair costs that tenants may not be able to afford, especially if they are relying solely on their voucher to cover rent.
However, these risks are offset by the high concentration of renters in the area, with 24.2% of residents being renters. High renter density typically translates into a robust demand for housing vouchers, making it easier to find qualified tenants who can utilize Section 8 vouchers. This demand ensures a steady stream of potential tenants, reducing the likelihood of prolonged vacancies.
In conclusion, despite the challenges posed by tenant turnover, vacancy exposure, and the need for deferred maintenance, the high renter share in ZIP 37650 presents a favorable environment for Section 8 investments. The overall risk for a first-time Section 8 landlord in this area is moderate.
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.