Location: Owen County, KY | Metro: Carroll 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 | $860 |
| 1 Bedroom | $920 |
| 2 Bedrooms | $1,200 |
| 3 Bedrooms | $1,540 |
| 4 Bedrooms | $1,630 |
| 5 Bedrooms | $1,891 |
| 6 Bedrooms | $2,118 |
| 7 Bedrooms | $2,287 |
| 8 Bedrooms | $2,401 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,540 | $189,404 | 0.81% | C |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 41098 provides insight into potential investment opportunities for landlords and small-portfolio investors. The Fair Market Rent (FMR) for a two-bedroom apartment in the area is set at $1,050 per month for fiscal year 2026, based on metro data. Meanwhile, the market rent for a similar unit stands at $1,053 per month according to the Census ACS.
To derive the gross yield, we first calculate the annualized rental income for both scenarios. For the Section 8 scenario, the annualized rental income is $1,050 multiplied by 12 months, totaling $12,600. In the case of market rent, the annualized income slightly increases to $12,636. Given the median home value in ZIP 41098 is $116,831, we can then determine the gross yield for each scenario.
The implied gross yield for the Section 8 scenario is calculated as follows: $12,600 divided by $116,831 equals approximately 10.8%. For the market rent scenario, the gross yield is $12,636 divided by $116,831, resulting in roughly 10.82%. These figures suggest that the difference between the two yields is negligible, with the market rent offering only a slight edge over the Section 8 rate.
However, considering the 23.0% renter density in the area, it's important to note that the demand for rental properties may be lower compared to areas with higher renter populations. This factor should be taken into account when evaluating the feasibility of investing in Section 8 properties versus market-rate rentals. Additionally, the lack of data on the days-on-market (DOM) for properties in ZIP 41098 makes it difficult to assess how quickly a property might be rented out under either scenario.
In conclusion, while the gross yields for both Section 8 and market-rate rentals are nearly identical, the decision to invest in one over the other should consider factors beyond just the yield, such as the stability and predictability of Section 8 income versus the potential variability of market rents. The low renter density also suggests that market conditions may favor long-term stability over short-term gains.
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.