Location: Nicholas County, KY | Metro: Lexington-Fayette, KY MSA
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 | $800 |
| 1 Bedroom | $980 |
| 2 Bedrooms | $1,150 |
| 3 Bedrooms | $1,570 |
| 4 Bedrooms | $1,750 |
| 5 Bedrooms | $2,030 |
| 6 Bedrooms | $2,274 |
| 7 Bedrooms | $2,456 |
| 8 Bedrooms | $2,579 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,150 | $143,262 | 0.8% | C |
| 3BR | $1,570 | $203,602 | 0.77% | D |
U.S. Census Bureau data (2024)
ZIP 40374, located in Sharpsburg, KY, within the Nicholas County, KY metro area, serves as a cash-flow anchor in a Section 8 portfolio strategy. The Family Monthly Rent (FMR) for FY 2024 in this ZIP code is set at $930, which is significantly higher than the market average rent of $664. This $266 monthly spread represents a strong positive cash flow opportunity for landlords participating in the Section 8 program.
The median home value in ZIP 40374 stands at $179,294, indicating that the area is relatively affordable compared to other parts of Kentucky. However, the primary focus for a Section 8 investment should be on the rental market dynamics rather than home values, as the program directly impacts rental income.
The lack of specific data on price-cut share and days on market (DOM) suggests that the appreciation potential for properties in this ZIP code is limited. Instead, the emphasis should be placed on the consistent cash flow generated by the guaranteed rental income from the Section 8 program. With an FMR above the market average, landlords can expect stable returns without the need to rely on property value increases.
ZIP 40374 also has a renter share of 21.9%, which is lower than many urban areas but still significant enough to support a rental business. The median income of $43,607 aligns well with the affordability of Section 8 rents, ensuring a steady demand from eligible tenants.
In summary, ZIP 40374 is best suited as a cash-flow anchor within a Section 8 portfolio due to the substantial difference between the FMR and market rent, providing landlords with reliable and predictable income streams.
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.