Location: Cincinnati, OH | Metro: Cincinnati, OH-KY-IN 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 | $1,040 |
| 1 Bedroom | $1,120 |
| 2 Bedrooms | $1,430 |
| 3 Bedrooms | $1,880 |
| 4 Bedrooms | $2,120 |
| 5 Bedrooms | $2,459 |
| 6 Bedrooms | $2,754 |
| 7 Bedrooms | $2,974 |
| 8 Bedrooms | $3,123 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,120 | $142,361 | 0.79% | D |
| 2BR | $1,430 | $201,335 | 0.71% | D |
| 3BR | $1,880 | $263,482 | 0.71% | D |
| 4BR | $2,120 | $338,733 | 0.63% | D |
| 5BR | $2,459 | $367,841 | 0.67% | D |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP 45212 (Norwood, OH) provides a clear picture of potential investment returns. Using the Fair Market Rent (FMR) for a 2-bedroom unit at $1150 per month, the annualized income would be $13,800. Against the median home value of $252,518, this implies a gross yield of approximately 5.47%. This calculation is derived by dividing the annual rental income by the property's value.
However, when comparing this figure to the market rent, represented by the Zillow Observed Rental Index (ZORI), at $1,226 per month, the annualized income increases to $14,712. The gross yield under this scenario improves to about 5.83%, calculated similarly by dividing the higher annual rental income by the same median home value.
To determine which scenario is more realistic, consider the local rental market dynamics. Norwood has a renter density of 51.3%, indicating a balanced market with nearly equal proportions of renters and homeowners. Additionally, the days on market (DOM) average of 37 days suggests a relatively quick turnover rate for rental properties, which can be indicative of strong demand.
The improved gross yield of 5.83% based on the ZORI is likely more reflective of the actual rental market conditions in Norwood. Given the quick DOM and balanced renter density, landlords can reasonably expect to achieve the market rent rather than the lower FMR. Therefore, while the FMR-based gross yield of 5.47% offers a conservative estimate, the ZORI-based gross yield of 5.83% aligns better with the current market realities and should be used as the basis for investment decisions.
Investors should note that these gross yields do not account for operating expenses, vacancy rates, or other factors that contribute to the net operating income (NOI). Nonetheless, they provide a solid foundation for understanding the potential income streams and should be factored into any comprehensive investment analysis.
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.