Location: Tate County, MS | 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 | $890 |
| 1 Bedroom | $900 |
| 2 Bedrooms | $1,170 |
| 3 Bedrooms | $1,410 |
| 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 | $1,170 | $156,796 | 0.75% | D |
| 3BR | $1,410 | $242,574 | 0.58% | F |
| 4BR | $1,540 | $369,539 | 0.42% | F |
U.S. Census Bureau data (2024)
The economics of Section 8 housing in ZIP code 38618, which encompasses Coldwater, Mississippi, and parts of Tate County, hinge on understanding the interplay between the SAFMR (Small Area Fair Market Rent) and the local market rent. For fiscal year 2024, the SAFMR for a two-bedroom apartment in this specific ZIP code is set at $1030. This figure represents the maximum amount that the housing authority will reimburse landlords for rent under the Section 8 program.
Local market rent, as reported by the Census Bureau's American Community Survey, is slightly higher at $1,035 for a similar two-bedroom unit. This means that if you're a landlord in ZIP 38618, your rental income from a Section 8 tenant will be capped at $1030 per month, regardless of the actual market conditions.
A Section 8 voucher works by covering the difference between what the tenant can afford and the rent amount. Typically, the tenant is expected to pay 30% of their adjusted income towards rent. If the tenant's portion plus any utility allowances does not meet the $1030 SAFMR, the housing authority makes up the shortfall. However, if the total exceeds $1030, the landlord must absorb the excess.
To illustrate, let's assume a tenant has an adjusted income of $1,200 per month. Thirty percent of this income is $360, which the tenant would pay toward the rent. If the utility allowance is $150, the total contribution from the tenant and the housing authority would be $510 ($360 tenant portion + $150 utilities).
In this scenario, the housing authority would cover the remaining $520 to reach the $1030 SAFMR. Therefore, the landlord receives a total of $1030 per month, which is the SAFMR limit for the area.
Given that the local market rent is $1,035, there is a $5 per month gap between the SAFMR and the market rent. This means landlords in ZIP 38618 accepting Section 8 vouchers will receive slightly less than the average market rent for a two-bedroom unit in the area.
In summary, while Section 8 provides a reliable source of rental income, it caps the reimbursement at the SAFMR level. In ZIP 38618, this cap is $1030 for a two-bedroom apartment, creating a minor surplus for the market rent but ensuring stability for both tenants and landlords.
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.