Location: Lexington-Fayette, KY | Metro: Lexington-Fayette, KY MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,100 |
| 1 Bedroom | $1,340 |
| 2 Bedrooms | $1,580 |
| 3 Bedrooms | $2,170 |
| 4 Bedrooms | $2,350 |
| 5 Bedrooms | $2,726 |
| 6 Bedrooms | $3,053 |
| 7 Bedrooms | $3,297 |
| 8 Bedrooms | $3,462 |
U.S. Census Bureau data (2024)
The analysis of ZIP code 40510 within the Lexington-Fayette, KY MSA metro area reveals several key points for landlords and small-portfolio investors.
Firstly, the rent math does not clearly work due to the absence of specific market rent data. The Fair Market Rent (FMR) for ZIP 40510 in fiscal year 2024 is set at $1290. Without comparative market rent figures, it's challenging to assess if this rate aligns with what tenants are willing to pay in the current market conditions.
Secondly, the acquisition cost appears to be high. With a median home value of $745,257, purchasing properties in this ZIP code would require a significant investment. There is no available data on the number of days on market (DOM) or the percentage of homes that have been listed with a price cut, which could provide insights into the difficulty of selling homes at their full asking price. However, the high median home value suggests that affordability for potential acquisitions might be a concern unless investors are prepared for a substantial capital outlay.
Lastly, there is moderate tenant demand. The ZIP code has a population of 1,904, with 23.7% of residents being renters. This indicates a smaller but steady pool of potential tenants who are interested in renting rather than owning their homes.
Verdict: Investing in ZIP 40510 presents challenges and opportunities. The lack of market rent data makes it difficult to gauge whether setting rents at the FMR level will attract tenants. High median home values suggest that acquiring rental properties will be costly, potentially limiting the number of investors willing to enter this market. However, the presence of a renter population, albeit small, ensures some demand. Landlords and investors should carefully consider these factors before proceeding, particularly focusing on securing accurate market rent information to validate their financial projections.
Data Sources: FMR data from HUD (2027). 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.