Section 8 Fair Market Rent (FMR) for ZIP 40476 - 2027

FY 2027 Fair Market Rent Rates

The economics of Section 8 housing in ZIP code 40476, located in Madison County, Kentucky, follow a specific formula based on the federal government's guidelines. For fiscal year 2026, the SAFMR (Small Area Fair Market Rent) for a two-bedroom apartment in this ZIP code is set at $900. This figure represents the maximum amount that the Housing Choice Voucher program will pay towards rent for a unit of this size in the area.

To understand the actual payment a landlord receives from a voucher holder, it's essential to break down the components. The tenant is responsible for paying 30% of their adjusted income towards rent. If we assume an average adjusted income of $1,200 per month for a household eligible for Section 8, the tenant's contribution would be $360. This amount is paid directly to the landlord along with the voucher payment.

The voucher itself covers the difference between the tenant's contribution and the SAFMR, up to $900. Therefore, if the tenant contributes $360, the voucher would cover the remaining $540. It's important to note that utilities are also a factor. Landlords receive additional payments for utilities, which can vary but are typically around $200 for a two-bedroom apartment. Thus, the total reimbursement a landlord might expect from a voucher holder could be approximately $740 ($540 for rent + $200 for utilities).

This calculation reveals a potential shortfall in rental income. Given the SAFMR of $900, a landlord would still need to make up the difference of $160 to reach the full SAFMR. However, this analysis assumes that the local market rent is equal to or below the SAFMR. Since the local market rent is listed as N/A, it's crucial for landlords to research current market rates to determine if there is a surplus or a gap.

In summary, landlords participating in the Section 8 program for a two-bedroom apartment in ZIP code 40476 can expect to receive a combination of the tenant's 30% contribution and the voucher payment, totaling around $740 for rent and utilities. This leaves a gap of $160 between the total SAFMR and the expected reimbursement, unless local market rents are lower than the SAFMR, in which case there may be no gap or even a surplus.

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.