Location: Cleveland, OH | Metro: Cleveland, OH 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 | $780 |
| 1 Bedroom | $880 |
| 2 Bedrooms | $1,070 |
| 3 Bedrooms | $1,370 |
| 4 Bedrooms | $1,470 |
| 5 Bedrooms | $1,705 |
| 6 Bedrooms | $1,910 |
| 7 Bedrooms | $2,063 |
| 8 Bedrooms | $2,166 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,070 | $60,726 | 1.76% | A+ |
| 3BR | $1,370 | $74,222 | 1.85% | A+ |
| 4BR | $1,470 | $84,218 | 1.75% | A+ |
| 5BR | $1,705 | $92,559 | 1.84% | A+ |
U.S. Census Bureau data (2024)
The analysis of the Section 8 program in ZIP code 44105, located in Cleveland, Ohio, reveals a significant gap between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR stands at $930, while the Zillow Observed Rent Index (ZORI), which reflects the current market conditions, indicates an average rent of $1,180. This results in a $250 difference, or approximately a 27% gap, between what landlords can charge voucher tenants and the open-market rent.
Given that the FMR is lower than the market rent, landlords must understand the financial implications of accepting Section 8 vouchers. The cost of housing voucher tenants below open-market rates means landlords will receive $930 per month, instead of the potential $1,180, resulting in a direct loss of $250 per unit per month. However, the stability and reliability of rental payments from voucher holders can offset some of this cost. Additionally, the city's demographics provide further context: with 50.8% of residents being renters and a median home value of $75,378, the demand for affordable housing is high.
The median income in Cleveland, OH, is $40,906, which suggests that many residents rely on assistance programs like Section 8 to secure housing. While the FMR is set to ensure affordability, it also limits the potential rental income for landlords. To maximize returns, landlords should consider the broader economic environment and the specific needs of their tenants. Accepting Section 8 vouchers can be a strategic move to fill units that might otherwise remain vacant, especially given the high percentage of renters in the area.
Landlords and small-portfolio investors must weigh the benefits of stable occupancy against the lower rental rates. The decision to participate in the Section 8 program should be based on a careful assessment of the local rental market and the landlord's financial goals. In ZIP 44105, where the market rent exceeds the FMR by $250, the choice to accept voucher tenants comes with a clear opportunity cost. However, the long-term stability and the ability to serve a critical need in the community can make this a viable option for some investors.
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.