Section 8 Fair Market Rent (FMR) for ZIP 45036 - 2027

Investment Score for ZIP 45036

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,050
1 Bedroom	$1,130
2 Bedrooms	$1,440
3 Bedrooms	$1,890
4 Bedrooms	$2,140
5 Bedrooms	$2,482
6 Bedrooms	$2,780
7 Bedrooms	$3,002
8 Bedrooms	$3,152

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,440	$283,300	0.51%	F
3BR	$1,890	$364,533	0.52%	F
4BR	$2,140	$529,984	0.4%	F
5BR	$2,482	$715,406	0.35%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 45036 (Lebanon, OH) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 45036 in Lebanon, Ohio, is set by HUD for 2026. The FMR for a two-bedroom unit is $1360, which represents 16.5% of the median household income of $99,128. This suggests that the rent for a two-bedroom unit is relatively affordable compared to the local income levels. However, the actual rental market price for a two-bedroom unit is significantly higher, with Zillow reporting a median price of $279,015. This translates into a monthly mortgage payment of approximately $1330, assuming a 4.5% interest rate and a 30-year fixed mortgage, which is very close to the FMR but does not account for additional costs such as property taxes, insurance, and maintenance. Given the high price-to-FMR ratio of 17.1x, it is clear that actual rents in the area far exceed the FMR. For instance, if we assume a typical rent-to-price ratio of around 0.5%, the implied average rent would be $1395 for a two-bedroom unit. This means that Section 8 voucher holders face significant constraints in finding housing that fits within their budget. They must find landlords willing to accept the lower FMR rates, which can be challenging given the high demand and limited supply of affordable units. #### Affordability & Renter Profile The population of Lebanon, OH, is 42,204, with 27.1% being renters. This indicates a substantial rental market, but the occupancy rate of 95.8% suggests that the market is quite tight, with few vacant units available. The median household income of $99,128 is relatively high, which implies that many residents have the financial means to afford higher rents. However, the 27.1% of renters who rely on Section 8 vouchers or other forms of assistance are likely to struggle in this environment due to the high cost of living. The high price-to-FMR ratio of 17.1x underscores the difficulty voucher holders face in finding affordable housing. Given the limited availability of units that fit within the FMR guidelines, there is a strong likelihood that voucher holders will need to compete intensely for the few affordable units available. This competition can lead to long wait times and potentially higher turnover rates among tenants who are unable to secure stable housing. #### Investor Angle From an investor’s perspective, the ZIP code 45036 presents a mixed picture. The high price-to-FMR ratio indicates that the market is overpriced relative to the FMR, which could make it difficult to achieve positive cash flow when relying solely on FMR rates. However, the high median household income and the substantial rental market suggest that there is potential for higher rents and occupancy rates. To determine whether this ZIP code is cash-flow positive at FMR, we need to consider the total costs of ownership. Assuming a mortgage payment of $1330 for a two-bedroom unit, property taxes of about $2000 per year (based on Warren County averages), insurance of $1200 per year, and maintenance costs of $1000 per year, the total annual cost of ownership would be approximately $22,500. Dividing this by 12 gives a monthly cost of $1875. At the FMR of $1360, the investor would incur a loss of $515 per month, indicating that the market is not cash-flow positive at FMR. The investment grade for this ZIP code would be considered low due to the negative cash flow at FMR rates. Investors should carefully evaluate their risk tolerance and consider strategies to mitigate losses, such as seeking higher rents or exploring alternative financing options. #### Specific Actionable Insights 1. **Focus on Affordable Units**: Investors should focus on acquiring properties that can be rented out at or slightly above the FMR rates. This strategy would help attract Section 8 voucher holders while minimizing the risk of vacancy. For example, a two-bedroom unit at $1450 per month would still be attractive to voucher holders and provide a modest profit margin. 2. **Consider Alternative Financing**: Given the negative cash flow at FMR rates, investors might consider alternative financing options such as hard money loans or private lenders. These options often come with higher interest rates but can provide the necessary capital to acquire properties in a tight market. 3. **Diversify Tenant Base**: To reduce dependency on Section 8 voucher holders, investors should diversify their tenant base by targeting both assisted and non-assisted renters. This can be achieved by setting rents at a range that includes both FMR and market rates. For instance, offering a two-bedroom unit at $1600 per month would cater to renters with higher incomes while still being within reach for some voucher holders. #### Bottom Line For Section 8-focused investors, the ZIP code 45036 (Lebanon, OH) is not recommended for purchase at this time. The high price-to-FMR ratio and negative cash flow at FMR rates indicate that the market is too expensive to generate positive returns without significant risks. Investors should hold off on purchasing properties in this ZIP code until either the FMR rates increase or the market prices decrease. Alternatively, they could explore other ZIP codes with more favorable price-to-FMR ratios and better cash flow potential.

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.