Location: Butler County, KY | Metro: Bowling Green, KY HUD Metro FMR Area
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 | $910 |
| 1 Bedroom | $1,000 |
| 2 Bedrooms | $1,180 |
| 3 Bedrooms | $1,420 |
| 4 Bedrooms | $1,930 |
| 5 Bedrooms | $2,239 |
| 6 Bedrooms | $2,508 |
| 7 Bedrooms | $2,709 |
| 8 Bedrooms | $2,844 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,000 | $114,542 | 0.87% | C |
| 2BR | $1,180 | $152,315 | 0.77% | D |
| 3BR | $1,420 | $236,088 | 0.6% | D |
| 4BR | $1,930 | $296,177 | 0.65% | D |
| 5BR | $2,239 | $380,311 | 0.59% | F |
U.S. Census Bureau data (2024)
Bowling Green’s 42101 ZIP code anchors the city’s urban core, blending historic residential blocks with the institutional gravity of Western Kentucky University. This area functions as the region’s economic and cultural hub, offering tenants walkable access to downtown amenities and major medical centers. With Med Center Health standing as a dominant local employer, the neighborhood draws a steady stream of healthcare professionals and university staff seeking housing near their workplaces, creating a consistent baseline demand for rental units.
From a valuation standpoint, investors face a distinct spread between government subsidies and private market rates. The HUD Fair Market Rent (FMR) for a 2-bedroom unit is set at $1,120 for FY2026, while current market rents (Zillow ZORI) hover around $1,252, leaving a gap of $132. Median home values sit at $243,026, with a specific 2BR median sale price of $149,183. Properties are moving relatively slowly, with a median of 119 days on market, suggesting buyers have leverage but must be prepared for longer holding periods before exiting.
The tenant profile is heavily rental-oriented, with 55.3% of households renting and a median household income of $48,217. This income level is slightly below the national median, indicating that a significant portion of the population may require rental assistance to afford market rates. The presence of highly-rated schools like Potter Gray Elementary and the city’s reliable transit connections make the area attractive for families, further supporting the need for 3- and 4-bedroom units where the FMR increases to $1,340 and $1,750, respectively.
The Section 8 verdict here leans toward stability and volume over immediate premium pricing. While the $132 gap between FMR and market rent means voucher holders do not cover top-tier rates, the exceptionally high renter share ensures a deep pool of potential tenants. For investors with efficient property management, the guaranteed payments via HUD against the $1,120 baseline offer a reliable hedge against vacancy in a market where homes sit for nearly four months on average.
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.