Location: Russell County, KY | Metro: Adair 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 | $840 |
| 2 Bedrooms | $910 |
| 3 Bedrooms | $1,090 |
| 4 Bedrooms | $1,200 |
| 5 Bedrooms | $1,392 |
| 6 Bedrooms | $1,559 |
| 7 Bedrooms | $1,684 |
| 8 Bedrooms | $1,768 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $910 | $135,686 | 0.67% | D |
| 3BR | $1,090 | $180,504 | 0.6% | D |
| 4BR | $1,200 | $242,481 | 0.49% | F |
U.S. Census Bureau data (2024)
The economics of Section 8 housing in ZIP 42539, which is located in Liberty, Kentucky, in Casey County, operate under specific financial guidelines that affect both landlords and tenants. For fiscal year 2026, the SAFMR (Small Area Fair Market Rent) for a two-bedroom apartment in this ZIP code is set at $870. This figure is specifically tailored for this area, reflecting the unique rental market conditions of ZIP 42539.
In contrast, the local market rent for a two-bedroom unit, based on Census ACS data, averages $674. This discrepancy between the SAFMR and the local market rent is significant for landlords, as it determines the maximum amount they can charge for a Section 8 rental agreement. Landlords must understand that while they can set their rent up to the SAFMR of $870, the actual payment they receive from the voucher program will be influenced by the tenant's contribution and utility allowances.
The voucher system requires tenants to pay 30% of their adjusted income toward rent. If we assume an average adjusted income for a tenant in this area, the calculation would proceed as follows: a tenant with an adjusted income of $1,000 per month would contribute $300 towards rent. This leaves the remainder of the rent to be covered by the Section 8 voucher, which in this case would be $570 ($870 - $300).
Additionally, the voucher includes utility allowances. These allowances vary but are typically around $100-$150 for a two-bedroom apartment. Therefore, if we consider a utility allowance of $125, the total reimbursement from the voucher program would be approximately $695 ($570 + $125).
This means that landlords in ZIP 42539 can expect to receive a reimbursement close to $695 for a two-bedroom apartment when all factors are considered. Given that the local market rent is $674, landlords participating in the Section 8 program would see a slight surplus of about $21 per month, assuming they charge the maximum allowable rent and the tenant’s income remains consistent with our example.
To summarize, landlords in ZIP 42539 can set their rent for a two-bedroom apartment up to $870, but the actual reimbursement from the Section 8 voucher program will be less due to the tenant's required contribution and utility allowances. In this scenario, landlords would receive a reimbursement that slightly exceeds the local market rent, resulting in a small surplus of $21 per month.
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.