Location: Louisville, KY | Metro: Elizabethtown, KY 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 | $780 |
| 1 Bedroom | $840 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,310 |
| 4 Bedrooms | $1,510 |
| 5 Bedrooms | $1,752 |
| 6 Bedrooms | $1,962 |
| 7 Bedrooms | $2,119 |
| 8 Bedrooms | $2,225 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,010 | $170,460 | 0.59% | F |
| 3BR | $1,310 | $273,921 | 0.48% | F |
U.S. Census Bureau data (2024)
To integrate ZIP 40150, Lebanon Junction, KY, into a Section 8 portfolio strategy, one must first understand the financial metrics and market dynamics specific to this area. As part of the Louisville, KY-IN HUD Metro FMR Area, ZIP 40150 offers a unique opportunity for investment.
The Fair Market Rent (FMR) for a one-bedroom apartment in ZIP 40150 for fiscal year 2024 is set at $1040. In contrast, the current market rent for a similar unit stands at $850. This indicates that properties in this ZIP code can be rented through the Section 8 program at a higher rate than the market would typically bear, providing a significant cash-flow advantage. The spread between the FMR and the market rent is $190 per month, which can serve as a solid anchor for cash flow in a diversified portfolio.
ZIP 40150 also has a median home value of $240,950, which is indicative of the overall housing market in the area. However, the primary focus for a Section 8 strategy should be on rental properties, where the FMR provides a guaranteed minimum rent. This makes ZIP 40150 particularly attractive for landlords and small-portfolio investors looking to stabilize their cash flows with government-backed rental rates.
The renter share in ZIP 40150 is 12.4%, suggesting that while there is a segment of the population that rents, it's not overwhelmingly dominated by renters. Additionally, the median household income of $65,500 supports the idea that the majority of residents can afford to own homes, but there remains a need for affordable rental housing, especially through programs like Section 8.
Given the significant positive spread between the FMR and market rent, ZIP 40150 serves best as a cash-flow anchor in a Section 8 portfolio strategy. This ensures steady, reliable income from government-subsidized rents, which can offset the risks associated with other types of investments or volatile markets.
In conclusion, ZIP 40150 is well-suited for inclusion in a Section 8 portfolio strategy as a cash-flow anchor due to the substantial difference between the FMR and market rent, ensuring a stable and predictable revenue stream.
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.