Location: Todd County, KY | Metro: Butler County, 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 | $680 |
| 1 Bedroom | $790 |
| 2 Bedrooms | $950 |
| 3 Bedrooms | $1,270 |
| 4 Bedrooms | $1,330 |
| 5 Bedrooms | $1,543 |
| 6 Bedrooms | $1,728 |
| 7 Bedrooms | $1,866 |
| 8 Bedrooms | $1,959 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $950 | $126,146 | 0.75% | D |
| 3BR | $1,270 | $211,054 | 0.6% | D |
| 4BR | $1,330 | $295,540 | 0.45% | F |
| 5BR | $1,543 | $368,385 | 0.42% | F |
U.S. Census Bureau data (2024)
Russellville, KY, with a ZIP code of 42276, is a modest-sized community of 16,044 residents. Nearly three out of ten households are renters, indicating a significant demand for rental properties. The median household income in the area stands at $57,144, reflecting a middle-class community. The median home value of $188,699 suggests that homeownership is accessible but not overly affordable, placing it in a range where rental properties can serve as a viable alternative for many.
The Federal Market Rent (FMR) for ZIP 42276 in fiscal year 2024 is set at $850, which is notably lower than the estimated market rent of $888 (ZORI). This indicates that while the government aims to keep housing costs manageable for those utilizing Section 8 vouchers, there is a slight premium in the actual market rates. For investors, this means that properties rented through Section 8 vouchers could offer stable income but might require careful management to ensure profitability.
Considering the characteristics of ZIP 42276, it is well-suited for both hands-off voucher operators and hands-on value-add buyers. Hands-off operators can benefit from the stability provided by Section 8 contracts, ensuring a steady stream of tenants and predictable income. On the other hand, value-add buyers have an opportunity to improve property values and rents, given the slight gap between FMR and ZORI. However, they must be prepared to invest in property upgrades and possibly face higher operational costs to justify the higher rents.
In summary, ZIP 42276 offers a balanced investment environment for Section 8-related real estate opportunities. Whether seeking passive income or actively managing properties for increased returns, the data points to a feasible market where both strategies can succeed. The key lies in aligning investment goals with the local economic conditions and tenant needs.
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.