Location: Webster County, KY | Metro: Crittenden 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 | $650 |
| 1 Bedroom | $700 |
| 2 Bedrooms | $910 |
| 3 Bedrooms | $1,230 |
| 4 Bedrooms | $1,270 |
| 5 Bedrooms | $1,473 |
| 6 Bedrooms | $1,650 |
| 7 Bedrooms | $1,782 |
| 8 Bedrooms | $1,871 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,230 | $120,882 | 1.02% | B |
U.S. Census Bureau data (2024)
The Section 8 thesis in ZIP code 42450 revolves around the significant gap between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2026, the FMR stands at $870, while the Census ACS reports the market rent at $691. This discrepancy amounts to a difference of $179 per month, or approximately 20.7%.
Given that the FMR exceeds the market rent, landlords and small-portfolio investors can leverage this situation to increase their yields. Voucher tenants, who benefit from government subsidies, provide a guaranteed rental income stream that is higher than what the market would otherwise offer. This makes properties in ZIP 42450 particularly attractive for those seeking to maximize returns on their investment.
The broader context of ZIP 42450 includes a rental population of 36.1%, indicating a substantial demand for rental housing. Additionally, the median home value is $113,974, which suggests a relatively affordable housing market. The median income of $54,710 further supports the argument that many residents rely on assistance programs like Section 8 to afford housing.
This scenario presents an opportunity for landlords to secure long-term, stable tenancy with minimal risk of vacancy. The guaranteed income from voucher tenants ensures steady cash flow, which is crucial for maintaining profitability and covering property expenses such as maintenance, taxes, and insurance. Therefore, the gap between FMR and market rent not only represents a financial advantage but also aligns with the local economic conditions, making it a compelling strategy for real estate investment.
To summarize, the $179 monthly difference between the FMR and market rent in ZIP 42450 translates into a 20.7% premium for landlords accepting voucher tenants. This premium, combined with the local context of a high rental population and moderate median income, positions Section 8 as a robust yield play for savvy investors.
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.