Location: Harlan County, KY | Metro: Harlan County, KY
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 | $840 |
| 1 Bedroom | $910 |
| 2 Bedrooms | $1,100 |
| 3 Bedrooms | $1,440 |
| 4 Bedrooms | $1,450 |
| 5 Bedrooms | $1,682 |
| 6 Bedrooms | $1,884 |
| 7 Bedrooms | $2,035 |
| 8 Bedrooms | $2,137 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,100 | $52,657 | 2.09% | A+ |
| 3BR | $1,440 | $89,496 | 1.61% | A+ |
U.S. Census Bureau data (2024)
To determine if you should buy in ZIP code 40873 (Wallins Creek, KY) for Section 8 investments, follow this decision tree:
1) Does the Fair Market Rent (FMR) of $1,020 cover the debt service on an $82,882 property?
Yes. The FMR of $1,020 is sufficient to cover typical debt service costs for a property valued at $82,882. This makes the investment financially viable based on Section 8 payments alone.
No. If the FMR does not cover your debt service, then this area is not suitable for Section 8 investments. You must ensure that the rental income meets or exceeds the cost of maintaining the mortgage or loan.
It Depends. If you need additional income sources to meet debt service requirements, consider whether there are other ways to generate revenue, such as renting out storage units or adding amenities.
2) Is the market rent of $845 above, at, or below the FMR?
Above. If the market rent is higher than the FMR, you can potentially charge non-Section 8 tenants the higher rate, increasing overall profitability.
At. If the market rent equals the FMR, you will likely be charging the same rate to all tenants, including those on Section 8 vouchers. This scenario maintains stability but offers limited upside.
Below. If the market rent is lower than the FMR, you might struggle to find non-Section 8 tenants willing to pay the higher FMR rate. This could limit your tenant pool and profitability.
3) Are 24.0% of residents renters and the number of days on the market (DOM) sufficient to ensure demand?
Yes. With 24.0% of the population being renters, there is a steady demand for housing. However, the lack of data on DOM suggests that properties are either rented quickly or there's a stable market without significant fluctuations in vacancy rates.
No. If the percentage of renters is too low or if properties take a long time to rent, this area may not be ideal for Section 8 investments due to insufficient demand.
It Depends. Consider other factors such as local employment rates, population growth, and competition from other rental properties. A detailed analysis of these elements will provide a clearer picture of the potential demand.
In summary, if the FMR covers debt service, the market rent is competitive or higher, and there is a consistent demand for rentals, then ZIP 40873 can be a good choice for Section 8 investments. Otherwise, proceed with caution.
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.