Location: Grainger County, TN | Metro: Kingsport-Bristol, TN-VA 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 | $700 |
| 1 Bedroom | $770 |
| 2 Bedrooms | $1,000 |
| 3 Bedrooms | $1,270 |
| 4 Bedrooms | $1,350 |
| 5 Bedrooms | $1,566 |
| 6 Bedrooms | $1,754 |
| 7 Bedrooms | $1,894 |
| 8 Bedrooms | $1,989 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,270 | $331,906 | 0.38% | F |
U.S. Census Bureau data (2024)
A skeptical investor considering ZIP 37811 might raise several concerns regarding the feasibility of investing in properties through the Section 8 program. Let's address these objections with the available data.
Objection 1: Will FMR $910 (zip FY 2024) cover the mortgage on a $214,301 home?
The Fair Market Rent (FMR) for ZIP 37811 in fiscal year 2024 is set at $910 per month. This amount must be sufficient to cover the monthly mortgage payments, property taxes, insurance, and maintenance costs. According to the median home value of $214,301, a typical mortgage payment, assuming a 30-year fixed-rate loan at an average interest rate of 4%, would be approximately $1,020 per month. Therefore, the FMR of $910 is insufficient to cover the mortgage alone, let alone other expenses. However, it's important to note that the FMR is often higher than the actual rental payment received from tenants participating in the Section 8 program, which could provide some buffer. Additionally, property values can vary widely, and lower-cost homes would have more manageable mortgage payments.
Objection 2: Is there enough renter demand at 11.3%?
The percentage of renters in ZIP 37811 stands at 11.3%. This figure suggests that the majority of residents own their homes rather than renting, which could indicate a relatively low demand for rental properties. However, the presence of the Section 8 program helps stabilize the rental market by providing a reliable source of income for landlords who qualify. The low renter demand percentage does not necessarily translate to a lack of tenant interest in affordable housing options, especially when the area has a mix of economic conditions supporting both homeownership and rental needs.
Objection 3: Will vouchers keep pace with $752 market rents?
The average market rent in ZIP 37811 is $752 per month, while the voucher amount is tied to the FMR of $910. Historically, the Housing Choice Voucher program adjusts the voucher amounts annually based on changes in the FMR. If the FMR increases, so should the voucher amount, ensuring that it remains competitive with the market rent. However, the data does not provide specific projections for future FMR adjustments. It's crucial for investors to monitor local housing trends and FMR updates to ensure that the voucher program continues to meet market demands.
In conclusion, while the data presents some challenges, particularly with the FMR being below the mortgage payment for a median-priced home, the Section 8 program still offers a stable investment option. The relatively low renter demand percentage does not preclude a viable rental market, especially for those in need of affordable housing. Lastly, the voucher program's adjustment mechanism should help maintain parity with market rents, although ongoing monitoring is advised.
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.