Section 8 Fair Market Rent (FMR) for ZIP 40405 - 2027

FY 2027 Fair Market Rent Rates

The ZIP code 40405, located in Madison County, Kentucky, is a PO Box ZIP code and does not have direct demographic data. However, it is situated within ZIP code 40403, which can provide some insights into the local real estate market. Given the lack of specific data for ZIP 40405, we will refer to the broader context provided by the surrounding areas.

Based on the data from nearby ZIP codes, ZIP 40405 is best categorized as a cash-flow anchor. This classification is derived from the comparison between the Federal Market Rent (FMR) for the larger Madison County metro area and the general real estate market conditions. For fiscal year 2026, the FMR for a two-bedroom apartment in the Madison County metro area is $900. While the exact market rent for ZIP 40405 is not specified, the surrounding areas indicate a stable and predictable rental market that aligns well with Section 8 housing vouchers.

Stable rental markets are crucial for cash-flow anchors because they ensure consistent tenant occupancy and rental income. Landlords and small-portfolio investors can rely on steady cash flow from properties in this area, particularly those participating in the Section 8 program. This makes ZIP 40405 a reliable choice for investors seeking long-term, low-risk investments.

Furthermore, the absence of significant appreciation potential or high renter shares suggests that this area is not primarily an appreciation play or a diversifier. The focus should remain on the stability and predictability of the rental market, which is key for maintaining a balanced investment portfolio.

Data Sources: FMR data from HUD (2027).

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.