Section 8 Fair Market Rent (FMR) for ZIP 46035 - 2027

Location: Montgomery County, IN | Metro: Indianapolis-Carmel, IN HUD Metro FMR Area

Investment Score for ZIP 46035

Monthly Rent (2BR)

$1,120

Median Price (2BR)

$174,578

1% Rule

0.64%

Annual Yield

7.7%

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	$890
1 Bedroom	$900
2 Bedrooms	$1,120
3 Bedrooms	$1,480
4 Bedrooms	$1,560
5 Bedrooms	$1,810
6 Bedrooms	$2,027
7 Bedrooms	$2,189
8 Bedrooms	$2,298

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	$1,120	$174,578	0.64%	D
3BR	$1,480	$241,188	0.61%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

Population

1,348

Median Household Income

$73,357

Housing Units

535

Renter Percentage

14.7%

Occupancy Rate

90.1%

Renter Occupied

The ZIP code 46035, encompassing Colfax, IN, presents a modest suburban setting with a blend of residential and agricultural influences. The area's rental market is indicative of a stable community where the Federal Market Rent (FMR) and actual market rents offer insights into the housing dynamics. Here is a concise analysis based on key data points:

Federal Market Rent (FMR) for ZIP 46035 is $1190 for fiscal year 2024. This figure represents the average rent for a two-bedroom apartment under the Section 8 program, indicating the subsidized rental rates that are available in the area.
The market rent for a similar unit stands at $821 according to the Census ACS. This suggests that the unsubsidized rental market is below the FMR, which could be advantageous for landlords participating in the Section 8 program as they receive higher rates compared to the local market.
The median home value in Colfax is $213,909. This reflects the typical cost of homeownership, which is lower than many metropolitan areas but still provides a solid base for property investment.
Renters make up 14.7% of the total population. This relatively low percentage of renters indicates that homeownership is prevalent, though there remains a consistent demand for rental properties among those who prefer or require renting.
The median household income is $73,357. This level of income supports a moderate rental market and suggests that tenants can afford reasonable rents, making it feasible for landlords to set competitive rates without pricing out potential tenants.
Data on days on market (DOM) is currently unavailable. However, given the stable nature of the market and the moderate income levels, it is likely that rental properties are occupied promptly once listed.

In summary, ZIP 46035 offers a balanced opportunity for landlords and small-portfolio investors. The gap between the FMR and market rent rates can provide a financial advantage for those willing to participate in the Section 8 program. With a median income that supports rental affordability and a moderate median home value, the area is attractive for investment. Despite the low renter share, the demand for rental properties is steady, making it a reliable market for long-term investment strategies.

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.