Location: Henderson County, KY | Metro: Henderson 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 | $880 |
| 1 Bedroom | $880 |
| 2 Bedrooms | $1,100 |
| 3 Bedrooms | $1,460 |
| 4 Bedrooms | $1,540 |
| 5 Bedrooms | $1,786 |
| 6 Bedrooms | $2,000 |
| 7 Bedrooms | $2,160 |
| 8 Bedrooms | $2,268 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,460 | $168,621 | 0.87% | C |
U.S. Census Bureau data (2024)
The Section 8 thesis in ZIP code 42451 is centered around the discrepancy between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR is set at $1,130, while the Census American Community Survey (ACS) reports the market rent at $1,315. This creates a gap of $185 per month, representing a 16.3% difference between the two figures.
Given that the FMR is lower than the market rent, landlords and small-portfolio investors should be aware of the financial implications when accepting housing vouchers. The cost of renting to voucher tenants at a rate below the open-market price can impact overall portfolio yields. However, the decision to participate in the Section 8 program must also consider the stability it provides, given that 38.2% of residents are renters. This percentage indicates a significant portion of the population relies on rental properties, making them a reliable source of consistent tenancy.
The median home value in the area is $142,088, which suggests that property values are relatively stable and could provide long-term appreciation potential. Additionally, the median income of $57,100 implies that many residents might find it challenging to afford higher rents, further justifying the attractiveness of Section 8 vouchers to potential tenants.
To summarize, the $185 monthly shortfall, or 16.3% of the market rent, is the key figure for investors considering Section 8 participation. While this may reduce immediate cash flow, it offers the advantage of a stable tenant base, especially in a region where a substantial number of residents are renters and have a median income that limits their ability to pay above average market rates.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.