Location: Obion County, TN | Metro: Gibson County, TN HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $760 |
| 1 Bedroom | $870 |
| 2 Bedrooms | $1,000 |
| 3 Bedrooms | $1,300 |
| 4 Bedrooms | $1,400 |
| 5 Bedrooms | $1,624 |
| 6 Bedrooms | $1,819 |
| 7 Bedrooms | $1,965 |
| 8 Bedrooms | $2,063 |
U.S. Census Bureau data (2024)
A skeptical investor looking into ZIP code 38259 might have several concerns regarding the feasibility of investing in properties there, especially when considering the Federal Market Rent (FMR) and voucher programs.
The first objection could be whether the FMR of $860 for the fiscal year 2024 will sufficiently cover the mortgage payments on a property valued at $108,237. To address this, one must consider the typical mortgage rates and terms. Assuming a standard 30-year fixed-rate mortgage at an average rate of 5%, the monthly mortgage payment for a $108,237 home would be approximately $570, leaving a substantial buffer of over $290 between the FMR and the mortgage payment. This suggests that the FMR can indeed cover the mortgage payments, with room left for other expenses such as maintenance, insurance, and taxes.
Another concern might revolve around the level of renter demand in ZIP 38259, which stands at 15.4%. This percentage indicates the share of households that are renters. While this figure is relatively low compared to national averages, it does not necessarily imply insufficient demand. The actual number of potential tenants depends on the total population and household size in the area. Additionally, the stability of rental demand can be influenced by local economic factors and employment opportunities, which are not directly addressed by this statistic alone.
A third point of skepticism could be whether the voucher amounts will keep pace with the market rents, currently estimated at $743. The FMR of $860 is higher than the market rent, suggesting that voucher recipients should have ample funds to cover their rent. However, the long-term sustainability of this gap relies on the government's ability to adjust voucher amounts in line with inflation and housing cost increases. As of now, the current voucher amount appears sufficient, but future adjustments will be critical to maintaining this balance.
In conclusion, while there are valid concerns about covering mortgage payments, ensuring renter demand, and keeping up with market rents, the data points towards a favorable investment climate in ZIP 38259. The FMR comfortably covers the mortgage, and the voucher program seems robust enough to meet current market conditions. Nonetheless, investors should remain vigilant about changes in local economics and government policies that could affect these dynamics.
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.