Location: Allen 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 | $1,080 |
| 1 Bedroom | $1,200 |
| 2 Bedrooms | $1,410 |
| 3 Bedrooms | $1,690 |
| 4 Bedrooms | $2,300 |
| 5 Bedrooms | $2,668 |
| 6 Bedrooms | $2,988 |
| 7 Bedrooms | $3,227 |
| 8 Bedrooms | $3,388 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,410 | $223,420 | 0.63% | D |
| 3BR | $1,690 | $341,537 | 0.49% | F |
| 4BR | $2,300 | $507,362 | 0.45% | F |
U.S. Census Bureau data (2024)
A skeptical investor might question whether the Fair Market Rent (FMR) of $1,110 for ZIP 42122 (Alvaton, KY) can cover the mortgage on a home priced at $408,350. According to recent mortgage rates, a typical 30-year fixed-rate mortgage might have an interest rate around 5%. For a home valued at $408,350, the monthly mortgage payment could be approximately $2,160, assuming a 20% down payment. This means that the FMR of $1,110 would not fully cover the mortgage payment. However, it's important to note that the actual mortgage rate can vary based on individual credit scores and economic conditions.
The investor may also doubt if the rental demand at 11.1% is sufficient. Current data shows that the rental demand in ZIP 42122 is relatively low compared to some other areas. However, this percentage indicates that there is still a market for rental properties. With a median home price of $381,277, the rental market could grow as more individuals seek affordable housing options. Additionally, the median rent is currently $850, which suggests that there is a segment of the population willing to pay for rental properties, even if they do not match the FMR.
Another concern could be whether housing vouchers will keep pace with the market rents of $1,013. Unfortunately, specific data regarding the housing voucher amounts for ZIP 42122 is not readily available. Generally, voucher amounts adjust annually based on the local Fair Market Rents, but the exact figure for Alvaton, KY, remains unclear. It's advisable to monitor local housing authority announcements for updates on voucher amounts.
In summary, while the FMR of $1,110 does not fully cover the mortgage payment on a $408,350 home, there is still potential for rental demand growth. The current median rent of $850 indicates a willingness among tenants to pay for housing. Lastly, the pace of housing voucher increases relative to market rents is uncertain and requires further investigation into local housing authority reports.
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.