Location: Memphis, TN | Metro: Memphis, TN-MS-AR HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $990 |
| 1 Bedroom | $1,070 |
| 2 Bedrooms | $1,180 |
| 3 Bedrooms | $1,550 |
| 4 Bedrooms | $1,790 |
| 5 Bedrooms | $2,076 |
| 6 Bedrooms | $2,325 |
| 7 Bedrooms | $2,511 |
| 8 Bedrooms | $2,637 |
U.S. Census Bureau data (2024)
The median home value in ZIP 38132, located in the Memphis, TN-MS-AR HUD Metro FMR Area, is $225,700 according to recent data from BestPlaces. This figure is notably lower than the U.S. median home value, indicating a potentially favorable environment for investors looking to capitalize on property values.
The HUD Fair Market Rent (FMR) for ZIP 38132 stands at $1,160 for the fiscal year 2024. In contrast, the average market rent in the same area is $1,649, as reported by Zillow. This comparison reveals that voucher tenants would typically generate a marginal cash flow at the FMR rate, suggesting that landlords and small-portfolio investors might need to consider premium units to ensure positive cash flow.
To derive the rent-to-price ratio, we can use the median home value and the average market rent. With a median home value of $225,700 and an average market rent of $1,649, the ratio is approximately 0.73%, indicating a relatively low rental yield compared to the home value. However, this metric alone does not fully capture the investment potential, as it does not account for the cost of ownership, including maintenance and financing expenses.
The dynamics between renting and buying in ZIP 38132 suggest that while the rental market is robust, the lower median home value could make owning properties attractive for long-term investments. The median days on market (DOM) and the percentage of price cuts are not available, but these factors are crucial in understanding the local real estate market's liquidity and competitiveness.
The strongest investor angle in ZIP 38132 appears to be stability, given the lower median home value and the presence of a steady rental market. While cash flow might be marginal at the FMR, the potential for appreciation in property values over time, combined with the consistent demand for rentals, makes this area a reliable choice for real estate investment.
Data Sources: FMR data from HUD (2027). 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.