Location: Dayton-Kettering-Beavercreek, OH | Metro: Dayton-Kettering-Beavercreek, OH MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $900 |
| 1 Bedroom | $990 |
| 2 Bedrooms | $1,230 |
| 3 Bedrooms | $1,600 |
| 4 Bedrooms | $1,750 |
| 5 Bedrooms | $2,030 |
| 6 Bedrooms | $2,274 |
| 7 Bedrooms | $2,456 |
| 8 Bedrooms | $2,579 |
The analysis for ZIP code 45470 in Ohio reveals some key insights into the potential Section 8 cap rates. The Fair Market Rent (FMR) for a two-bedroom apartment in fiscal year 2024 is set at $1010 per month. However, the median home value and market rent figures are not available, making it challenging to provide a precise comparison.
To calculate the implied gross yield, we need to annualize the FMR. For a two-bedroom unit, the annualized rent would be $12,120 ($1010 x 12 months). Without the median home value, we cannot directly compute the cap rate, which is the ratio of net operating income (NOI) to property asset value. However, we can discuss the implications of the gross yield based on the available FMR.
In a scenario where the FMR is used as the rental income, the gross yield would be significantly lower compared to typical market rents due to the fixed nature of Section 8 payments. This means that the rental income from a Section 8 tenant is capped at the FMR amount, regardless of market conditions.
The lack of data on market rent and median home value makes it difficult to determine how competitive the Section 8 gross yield is relative to the broader rental market. Additionally, without knowing the renter density and days on market (DOM), we cannot accurately assess the demand for rental properties in ZIP 45470.
Given the limited data, the most realistic assessment of the gross yield would be based on the FMR, assuming that the majority of homes in this area are rented out through the Section 8 program. However, this assumption is speculative without additional information on the local rental market dynamics.
Investors should consider these factors when evaluating the potential returns from properties in ZIP 45470 under the Section 8 program. While the FMR provides a clear benchmark for rental income, the absence of other critical data points such as median home values and market rent levels leaves significant uncertainty regarding the overall profitability of such investments.
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.