Location: Casey County, KY | Metro: Casey 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 | $670 |
| 1 Bedroom | $840 |
| 2 Bedrooms | $930 |
| 3 Bedrooms | $1,110 |
| 4 Bedrooms | $1,280 |
| 5 Bedrooms | $1,485 |
| 6 Bedrooms | $1,663 |
| 7 Bedrooms | $1,796 |
| 8 Bedrooms | $1,886 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,110 | $167,196 | 0.66% | D |
U.S. Census Bureau data (2024)
The ZIP code 42541, located in Kentucky, has a median income of $43,232. This figure is crucial when considering the financial capabilities of the average household in terms of housing costs. Unfortunately, the market rate rental price for the area is listed as N/A, which makes it difficult to assess how well the median income aligns with typical rental costs. However, we can evaluate the situation based on the Fair Market Rent (FMR) standard set at $920 per month for the metro area in fiscal year 2026.
To frame this from the renter's perspective, let's consider what $920 means in the context of a $43,232 annual income. On average, a household would spend approximately 26% of their pre-tax income on rent if they were paying the FMR. This percentage is within the general guideline that rent should not exceed 30% of a household's income, indicating that while tight, the FMR is generally affordable for the average household in ZIP 42541.
However, the data reveals a significant challenge for landlords and small-portfolio investors. The ZIP code has a relatively low population of 498, with only 15.4% of those being renters. This translates to roughly 76 potential renters, which limits the pool of tenants available to landlords. Moreover, the scarcity of renters combined with the specific income levels suggests a competitive environment where landlords must carefully consider their pricing strategies to attract and retain tenants.
When comparing voucher payments to market rates, landlords face a strategic decision. The voucher payment standard of $920 per month ensures a steady and government-backed income stream, albeit at a fixed rate. If the actual market rate is higher than $920, landlords might find themselves in a position where accepting vouchers could mean lower profits compared to renting to cash-paying tenants willing to pay more. Conversely, if the market rate is close to or below $920, vouchers provide a reliable source of income without the risk of vacancy.
The takeaway for landlords is clear: given the limited number of renters and the income levels in ZIP 42541, focusing on voucher tenants can be a prudent strategy to ensure occupancy. However, landlords should also explore the local rental market to understand if there is demand for units priced above the FMR, especially among those who might have higher incomes or additional sources of funding. Balancing between voucher and cash-pay strategies will be key to maximizing profitability while maintaining occupancy rates.
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.