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 | $1,200 |
| 1 Bedroom | $1,210 |
| 2 Bedrooms | $1,510 |
| 3 Bedrooms | $1,890 |
| 4 Bedrooms | $2,170 |
| 5 Bedrooms | $2,517 |
| 6 Bedrooms | $2,819 |
| 7 Bedrooms | $3,045 |
| 8 Bedrooms | $3,197 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,210 | $257,041 | 0.47% | F |
| 2BR | $1,510 | $389,143 | 0.39% | F |
| 3BR | $1,890 | $514,158 | 0.37% | F |
U.S. Census Bureau data (2024)
The Fair Market Rent (FMR) for ZIP code 37916 in Knoxville, Tennessee, for fiscal year 2024 is set at $1220. This figure represents the payment standard for Section 8 housing assistance in your area. It is important to note that this is not the amount you will charge tenants as rent, but rather the maximum subsidy amount that the Housing Choice Voucher program will pay on behalf of eligible tenants.
In comparison, the local median rent for a two-bedroom apartment in ZIP 37916 is currently $1,788, according to the Zillow Observed Rent Index (ZORI). This means that if you decide to participate in the Section 8 program, you should expect to receive a subsidy of up to $1220 per month for a two-bedroom unit. The difference between the ZORI and the FMR reflects the gap between market rates and the subsidized rate, which can impact your overall income from a Section 8 property.
The demand for affordable housing in this area is high, with a renter share of 97.5%. This indicates that nearly all residents in ZIP 37916 are renters, making it a prime location for rental investments. However, the average acquisition cost for a rental property in this ZIP code is approximately $484,343. This is the amount you would typically spend to purchase an existing property suitable for renting out.
Before proceeding with a Section 8 rental in ZIP 37916, ensure that your property meets all the necessary requirements for the Housing Choice Voucher program. This includes passing a housing quality standards inspection, which verifies that the home is safe, decent, and sanitary. Compliance with these standards is crucial because it directly affects whether you can qualify for the subsidy and avoid potential penalties or contract termination.
Participating in the Section 8 program can provide a steady stream of income, particularly if you manage your costs effectively. However, be prepared to deal with government oversight and maintain a property that adheres to strict guidelines to continue receiving subsidies.
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.