Location: Indianapolis-Carmel, 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 | $1,580 |
| 1 Bedroom | $1,770 |
| 2 Bedrooms | $2,040 |
| 3 Bedrooms | $2,640 |
| 4 Bedrooms | $3,220 |
| 5 Bedrooms | $3,735 |
| 6 Bedrooms | $4,183 |
| 7 Bedrooms | $4,518 |
| 8 Bedrooms | $4,744 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,040 | $269,688 | 0.76% | D |
| 3BR | $2,640 | $361,539 | 0.73% | D |
| 4BR | $3,220 | $518,027 | 0.62% | D |
| 5BR | $3,735 | $585,285 | 0.64% | D |
U.S. Census Bureau data (2024)
The Section 8 program in ZIP code 46106, which encompasses Bargersville, IN, presents a unique opportunity for landlords and small-portfolio investors due to the disparity between the Fair Market Rent (FMR) and the actual market rent. The FMR for ZIP 46106 for fiscal year 2024 is set at $1730, whereas the market rent, measured by Zillow's Observed Rental Index (ZORI), stands at $1691. This means that the FMR is $39 higher than the market rent, or approximately 2.3% above it.
This gap indicates that landlords can benefit from accepting Section 8 tenants, as they will receive a slightly higher rent than what the open market currently offers. The FMR is designed to ensure that rental units are affordable for low-income families, making it an attractive proposition for those who qualify for housing vouchers. In Bargersville, where only 16.6% of residents are renters, and the median home value is $445,802, the demand for rental properties is relatively low compared to homeownership. However, the median household income of $120,072 suggests that many local residents might find it challenging to afford the high cost of living without assistance.
The higher FMR compared to the market rent makes this area a yield play for landlords. By participating in the Section 8 program, they can secure a steady stream of rental income that is guaranteed by the government, ensuring that they receive the full amount of the FMR each month. This stability can be particularly beneficial for small-portfolio investors who need reliable cash flow to manage their investments effectively.
However, it is crucial to understand the implications of renting below open-market rates. While the FMR provides a slight premium over the current market rent, landlords should also consider the administrative requirements and potential maintenance costs associated with Section 8 properties. These factors can influence the overall profitability and management of the investment.
In summary, the Section 8 program in ZIP 46106 offers a yield advantage for landlords and small-portfolio investors, with the FMR being $39 higher than the market rent. This difference, while modest, can provide a stable source of income in an area where the majority of residents own homes and the cost of living is relatively high.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.