Section 8 Fair Market Rent (FMR) for ZIP 39402 - 2027

Investment Score for ZIP 39402

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,080
1 Bedroom	$1,320
2 Bedrooms	$1,550
3 Bedrooms	$1,970
4 Bedrooms	$2,040
5 Bedrooms	$2,366
6 Bedrooms	$2,650
7 Bedrooms	$2,862
8 Bedrooms	$3,005

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,550	$184,080	0.84%	C
3BR	$1,970	$246,018	0.8%	C
4BR	$2,040	$366,474	0.56%	F
5BR	$2,366	$510,921	0.46%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 39402 (Hattiesburg, MS) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 39402, as determined by HUD for 2026, is set at $1260 for a two-bedroom unit. This figure represents approximately 20.1% of the median household income of $75,220 in the area. The FMR is intended to reflect the average rent that a family would pay in the private market. However, it is important to note that the actual rents charged in the market can vary significantly from these figures. In Hattiesburg, the actual rents charged for two-bedroom units are likely higher than the FMR. For instance, the Zillow median price for a two-bedroom home is $184,664, which translates into a monthly rental cost that is much higher than the FMR. The price-to-FMR ratio is 12.2x, indicating that the actual market rents are substantially above the FMR. This means that voucher holders may face significant constraints when trying to find housing that fits within their budget. They might have to look for units that are smaller or less desirable to stay within the $1260 limit. #### Affordability & Renter Profile ZIP code 39402 has a population of 44,620, with 39.6% of residents being renters. This indicates a substantial rental market, but it also suggests that there could be competition for affordable units. The occupancy rate of 93.2% shows that the housing stock is mostly occupied, leaving little room for new entrants unless existing tenants move out. Given the median household income of $75,220, the FMR for a two-bedroom unit ($1260) is relatively affordable at 20.1% of the median income. However, the actual market rents are much higher, making it challenging for low-income families to find suitable housing without assistance. The high price-to-FMR ratio suggests that the market is tight and that many units are priced well above what voucher holders can afford. #### Investor Angle From an investor perspective, the ZIP code 39402 presents a mixed picture. While the actual market rents are high, the FMR is set lower to accommodate the needs of low-income families. Investors who focus on Section 8 properties need to understand the dynamics between the FMR and the actual rents they can charge. The FMR for a two-bedroom unit is $1260, which is significantly below the Zillow median price for a similar unit. This means that investors who purchase properties in this ZIP code will likely see a cash flow that is positive but limited to the FMR levels. Given the high market rents, there is potential for investors to earn more if they can secure non-voucher tenants willing to pay the higher rates. The investment grade for this ZIP code would depend on several factors, including the demand for affordable housing, the availability of Section 8 vouchers, and the overall economic conditions. With a renter population of 39.6%, there is a steady demand for rental properties. However, the high price-to-FMR ratio indicates that the market is not particularly favorable for investors focusing solely on Section 8 properties. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should consider focusing on smaller units such as one-bedroom or studio apartments. The FMR for a one-bedroom unit is $1070, which is still below the actual market rents. This allows investors to potentially attract both voucher holders and other tenants willing to pay more, thereby maximizing their cash flow. 2. **Target Affordable Neighborhoods**: Within ZIP code 39402, there may be neighborhoods where the rents are closer to the FMR. Identifying these areas and targeting them for investment can help investors secure properties that are more likely to be rented by voucher holders. This strategy can also mitigate the risk of vacancy in a market where many units are priced above the FMR. 3. **Consider Mixed-Income Developments**: Developing properties that cater to both low-income and middle-income tenants can provide a balanced approach. By offering a mix of units at different price points, investors can ensure a steady stream of tenants while also benefiting from the higher rents charged to non-voucher holders. #### Bottom Line For investors focused on Section 8 properties, ZIP code 39402 presents a challenging environment due to the high price-to-FMR ratio. The recommendation for this ZIP code is to **Hold** or **Skip**, depending on the investor's strategy. If an investor is willing to target smaller units or affordable neighborhoods, they may find opportunities to generate positive cash flow. However, given the tight market and the high actual rents, investing in larger units or properties outside these targeted areas may not be as profitable for Section 8-focused investors.

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.