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 | $1,520 |
| 1 Bedroom | $1,530 |
| 2 Bedrooms | $1,920 |
| 3 Bedrooms | $2,400 |
| 4 Bedrooms | $2,760 |
| 5 Bedrooms | $3,202 |
| 6 Bedrooms | $3,586 |
| 7 Bedrooms | $3,873 |
| 8 Bedrooms | $4,067 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,920 | $290,557 | 0.66% | D |
| 3BR | $2,400 | $459,395 | 0.52% | F |
| 4BR | $2,760 | $586,957 | 0.47% | F |
| 5BR | $3,202 | $694,879 | 0.46% | F |
U.S. Census Bureau data (2024)
The median income in ZIP code 37932, located in Knoxville, TN, stands at $119,703. This figure provides a baseline for understanding the economic capacity of households in the area. However, when we consider the market rate for rent, which is $1,975 (ZORI), it becomes evident that a significant portion of the population might struggle to afford these rates.
Comparatively, the Housing Choice Voucher Payment Standard for Fair Market Rent (FMR) in ZIP 37932 for fiscal year 2024 is set at $1,630. This amount represents the maximum monthly rental payment that a voucher holder can be expected to pay, which is considerably lower than the market rate.
In ZIP 37932, where 28.4% of the population are renters and the total population is 25,424, the affordability gap between the ZORI ($1,975) and the FMR ($1,630) has implications for landlord competition. Landlords who set their rents closer to the ZORI will likely face reduced demand from households with median incomes, as they would need to allocate a larger portion of their earnings towards housing costs.
The takeaway for landlords considering whether to accept vouchers versus relying on cash-paying tenants is clear. While accepting vouchers might result in a slightly lower rental income, it opens up the property to a broader segment of the rental market. Given the median income and the high market rate, many potential tenants may find themselves eligible for assistance programs. Therefore, landlords should weigh the benefits of a steady, government-backed income against the risks of vacancy in a market where the median income might not cover the full market rate without subsidy.
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.