Location: Tallahatchie County, MS | Metro: Carroll County, MS
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 | $740 |
| 1 Bedroom | $750 |
| 2 Bedrooms | $960 |
| 3 Bedrooms | $1,150 |
| 4 Bedrooms | $1,290 |
| 5 Bedrooms | $1,496 |
| 6 Bedrooms | $1,676 |
| 7 Bedrooms | $1,810 |
| 8 Bedrooms | $1,901 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,150 | $151,036 | 0.76% | D |
U.S. Census Bureau data (2024)
The ZIP code 38940 is situated in a small-town setting, characterized by a modest population of 1,994 residents. The area has a rental market presence with 27.5% of the population being renters, indicating a stable but not highly active leasing environment. The median household income in this region stands at $64,048, which is reflective of a middle-class community. This economic profile is further supported by the median home value of $154,947, suggesting that homeownership is attainable for many local residents.
Moving into the specifics of rental economics, the Fair Market Rent (FMR) for ZIP 38940, as set for the metro area for fiscal year 2026, is $900. In contrast, the current market rent, according to the Census ACS, is $875. This slight discrepancy between the FMR and the actual market rent suggests a potential opportunity for landlords to slightly increase their rents while still remaining competitive and within government guidelines, particularly for those who manage properties under the Section 8 Housing Choice Voucher program.
Given these economic factors, ZIP 38940 might be more suitable for a hands-off voucher operator rather than a hands-on value-add buyer. The relatively low median income and home values indicate a market where the demand for affordable housing is likely strong. Landlords can benefit from the stability provided by the Section 8 program without needing extensive renovations or value-adding strategies to attract tenants. However, a hands-on approach could still find success if focused on maintaining properties at a standard that justifies the slightly higher end of the rent spectrum allowed by the FMR.
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.