Location: Montgomery County, IN | Metro: Indianapolis-Carmel, 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 | $990 |
| 1 Bedroom | $1,110 |
| 2 Bedrooms | $1,280 |
| 3 Bedrooms | $1,660 |
| 4 Bedrooms | $2,020 |
| 5 Bedrooms | $2,343 |
| 6 Bedrooms | $2,624 |
| 7 Bedrooms | $2,834 |
| 8 Bedrooms | $2,976 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,280 | $249,167 | 0.51% | F |
| 3BR | $1,660 | $327,264 | 0.51% | F |
| 4BR | $2,020 | $375,917 | 0.54% | F |
U.S. Census Bureau data (2024)
The economics of Section 8 housing in ZIP code 46071, which encompasses Thorntown, IN, in Boone County, are defined by the SAFMR (Small Area Fair Market Rent) rates set specifically for this ZIP code. For a two-bedroom apartment, the SAFMR for FY 2024 is $1230. This is significantly higher than the local market rent, which averages at $896 according to the Census ACS data.
A Section 8 voucher does not cover the entire rent amount; it is designed to subsidize the difference between what a low-income family can afford and the actual rent. Here’s how it works for landlords:
The tenant's portion of the rent is typically calculated as 30% of their adjusted monthly income. If the tenant's adjusted monthly income is $1000, their contribution would be $300. The remaining amount up to the SAFMR is covered by the Section 8 program. In this case, the reimbursement would be $1230 minus the $300 tenant contribution, totaling $930.
In addition to the base rent, Section 8 also provides utility allowances. These vary but generally add a few hundred dollars to the total reimbursement. For a two-bedroom unit, let's assume an additional utility allowance of $200. Therefore, the total reimbursement per month would be $930 for rent plus $200 for utilities, equaling $1130.
This means that if you charge the SAFMR rate of $1230, you will receive $1130 from the voucher program, leaving a shortfall of $100 per month. However, if you set your rent closer to the local market rate of $896, you will likely fill vacancies faster and still receive a substantial reimbursement of $930, creating a surplus of $34 per month.
The key takeaway is that while the SAFMR rate is higher than the local market, the actual reimbursement is lower due to the tenant's contribution. Landlords should carefully consider these factors when setting rental rates for Section 8 tenants in ZIP 46071.
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.