Location: Knoxville, TN | Metro: Knoxville, TN HUD Metro FMR Area
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 | $1,160 |
| 1 Bedroom | $1,170 |
| 2 Bedrooms | $1,460 |
| 3 Bedrooms | $1,830 |
| 4 Bedrooms | $2,100 |
| 5 Bedrooms | $2,436 |
| 6 Bedrooms | $2,728 |
| 7 Bedrooms | $2,946 |
| 8 Bedrooms | $3,093 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,460 | $273,538 | 0.53% | F |
| 3BR | $1,830 | $375,557 | 0.49% | F |
| 4BR | $2,100 | $520,496 | 0.4% | F |
| 5BR | $2,436 | $729,340 | 0.33% | F |
U.S. Census Bureau data (2024)
The ZIP code 37909 represents a neighborhood in Knoxville, Tennessee, characterized by a diverse mix of residents with a significant portion of renters. With a total population of 16,774, nearly half—52.9%—are tenants, indicating a robust rental market. The median household income stands at $66,984, suggesting a middle-class community where financial stability is evident among many residents. The median home value in the area is $376,373, reflecting a moderate cost of living compared to other parts of the city.
Moving into the specifics of rental economics, the Fair Market Rent (FMR) for the ZIP code 37909 for fiscal year 2024 is set at $1,260. This figure contrasts sharply with the actual market rent, which is estimated at $2,062 based on Zillow's Observed Rent Index (ZORI). This discrepancy highlights a potential opportunity for landlords who can leverage the lower FMR to attract Section 8 tenants while still achieving rents close to the market rate, thereby maximizing their investment returns.
Given these economic conditions, the neighborhood appears to be well-suited for both hands-off voucher operators and hands-on value-add buyers. For hands-off operators, the presence of a substantial number of renters and the relatively stable median income levels ensure a steady stream of Section 8 tenants. On the other hand, hands-on investors can take advantage of the gap between the FMR and market rent to improve properties and charge slightly above the FMR, capturing additional revenue without significantly increasing the risk profile of their investments. Overall, ZIP 37909 offers a balanced environment where either investment strategy can succeed, depending on the landlord's goals and resources.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.