Location: Morgan County, KY | Metro: Johnson County, KY
| Unit Size | Monthly FMR |
|---|---|
| Studio | $650 |
| 1 Bedroom | $840 |
| 2 Bedrooms | $910 |
| 3 Bedrooms | $1,090 |
| 4 Bedrooms | $1,270 |
| 5 Bedrooms | $1,473 |
| 6 Bedrooms | $1,650 |
| 7 Bedrooms | $1,782 |
| 8 Bedrooms | $1,871 |
U.S. Census Bureau data (2024)
A landlord considering purchasing a property in ZIP code 41465 for Section 8 investment must follow a structured decision-making process based on financial metrics and market conditions.
Step 1: Evaluate if the Fair Market Rent (FMR) of $870 can cover the debt service on a property valued at $120,113. In this case, the FMR does not sufficiently cover the debt service, which typically includes mortgage payments, insurance, and maintenance costs. This suggests a negative cash flow scenario for the landlord, making it a No for investment unless other sources of income or subsidies are available.
Step 2: Determine how the market rent of $732 compares to the FMR. Here, the market rent is below the FMR. This means that properties in this area are generally rented out for less than what the government would pay under the Section 8 program. However, since the FMR cannot cover the debt service, this point becomes secondary in the decision-making process.
Step 3: Assess the rental demand. The data indicates that 24.5% of the population are renters, but the Days on Market (DOM) is listed as N/A. Without accurate DOM data, it's impossible to definitively gauge the speed at which units become occupied. However, the percentage of renters alone is insufficient to conclude strong demand. Given the first two points, the answer remains a No.
To summarize, for ZIP 41465, the decision tree for a Section 8 investment leads to a No. The primary reason is that the FMR of $870 is not enough to clear the debt service on a property costing $120,113. Additionally, the market rent being below the FMR and the lack of clear DOM data further complicate the investment viability.
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.