Location: Memphis, TN | Metro: Memphis, TN-MS-AR 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 | $850 |
| 1 Bedroom | $920 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,330 |
| 4 Bedrooms | $1,540 |
| 5 Bedrooms | $1,786 |
| 6 Bedrooms | $2,000 |
| 7 Bedrooms | $2,160 |
| 8 Bedrooms | $2,268 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,010 | $59,318 | 1.7% | A+ |
| 3BR | $1,330 | $84,089 | 1.58% | A+ |
| 4BR | $1,540 | $87,415 | 1.76% | A+ |
U.S. Census Bureau data (2024)
The analysis of ZIP code 38108 in Memphis, TN, reveals key insights for landlords and small-portfolio investors. The first question addresses whether the rent math works. The Fair Market Rent (FMR) set at $1020 for the fiscal year 2024 is higher than the market rent, which stands at $939 according to ZORI. This suggests that landlords can potentially charge above the market rate, but should be cautious not to exceed the FMR threshold if they wish to attract tenants eligible for Section 8 assistance.
Regarding the affordability of acquisitions, the median home value of $71,123 is relatively low, indicating that purchasing properties in this area could be financially feasible for investors. However, the lack of data on days on market (DOM) and the fact that only 0.2% of homes are listed with a price cut suggest that the market might be tight, with fewer opportunities for bargain purchases.
Tenant demand is strong in ZIP 38108, given a population of 17,562 and a renter share of 54.0%. This high percentage of renters implies a robust market for rental properties, making it likely that there will be sufficient demand to fill vacancies quickly.
In conclusion, ZIP 38108 presents a viable investment opportunity for landlords and small-portfolio investors due to the potential to charge rents close to the FMR without significantly exceeding market rates. The low median home value supports affordable acquisitions, although the limited availability of price-cut listings might restrict bargain hunting. With over half of the population renting, there is a substantial tenant base, ensuring steady demand for rental units. However, landlords must carefully balance their rents to remain competitive while attracting Section 8 tenants.
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.