Location: Cleveland, OH | Metro: Cleveland, OH HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $930 |
| 1 Bedroom | $1,060 |
| 2 Bedrooms | $1,280 |
| 3 Bedrooms | $1,640 |
| 4 Bedrooms | $1,760 |
| 5 Bedrooms | $2,042 |
| 6 Bedrooms | $2,287 |
| 7 Bedrooms | $2,470 |
| 8 Bedrooms | $2,594 |
The analysis of the Section 8 cap-rate scenario for ZIP code 44181 in Ohio reveals some critical insights for landlords and small-portfolio investors. The Fair Market Rent (FMR) for a two-bedroom apartment in this area, for fiscal year 2024, is set at $1100 per month. This translates into an annualized rental income of $13,200.
To calculate the implied gross yield, we need to consider the median home value. However, the data provided does not include the median home value for ZIP 44181, making it impossible to derive an exact gross yield figure based on this information alone. Typically, the gross yield is calculated as the annual rental income divided by the property's value. Without the median home value, we cannot provide a precise gross yield percentage.
In addition, the market rent for the area is listed as N/A, which means that there isn't sufficient data to compare the Section 8 FMR against typical market rates. This absence of market rent data further complicates the assessment of potential profitability for properties under the Section 8 program versus those rented at market rates.
The renter density and days on market (DOM) are also noted as N/A, indicating a lack of detailed information about the local rental market dynamics. Renter density can influence the demand for Section 8 housing, while DOM can give insight into how quickly properties are leased, affecting vacancy rates and overall profitability.
Given the limitations in the available data, it's challenging to definitively state whether the Section 8 scenario or a market-rate scenario would be more profitable. However, the annualized FMR of $13,200 provides a clear baseline for the minimum guaranteed income landlords can expect if they participate in the Section 8 program. This stability can be attractive compared to the variability often found in market-rate rents, especially in areas where renter density is high and DOM is low, though these specifics are not available for ZIP 44181.
Landlords and investors should use the provided FMR to anchor their financial planning and consider other factors such as maintenance costs, property management fees, and local housing trends to make informed decisions about participating in the Section 8 program in ZIP 44181.
Data Sources: FMR data from HUD (2027).
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.