Section 8 Fair Market Rent (FMR) for ZIP 46112 - 2027

Investment Score for ZIP 46112

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	$1,420
1 Bedroom	$1,600
2 Bedrooms	$1,840
3 Bedrooms	$2,390
4 Bedrooms	$2,900
5 Bedrooms	$3,364
6 Bedrooms	$3,768
7 Bedrooms	$4,069
8 Bedrooms	$4,272

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	$1,840	$251,646	0.73%	D
3BR	$2,390	$310,614	0.77%	D
4BR	$2,900	$423,110	0.69%	D
5BR	$3,364	$489,085	0.69%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 46112 (Brownsburg, IN) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 46112 in 2026 is set at $1740 for a two-bedroom unit, which represents 18.5% of the median household income of $112,565. However, the actual rental market price for a two-bedroom unit is significantly higher, with Zillow reporting a median price of $246,973. This translates to a price-to-FMR ratio of 11.8x, indicating that actual rents are far above the FMR levels. For voucher holders, this means they face substantial constraints in finding affordable housing within their budget. The FMR is designed to cover approximately 40% of the rent, but given the high actual rental prices, voucher holders would need to find units priced well below the market average to make ends meet. #### Affordability & Renter Profile In ZIP 46112, only 18.9% of the population are renters, suggesting a relatively low demand for rental properties compared to owner-occupied homes. The occupancy rate of 96.8% indicates a tight rental market where most available units are quickly occupied. Given the high median household income and the fact that only 18.9% of residents are renters, it is likely that those who do rent are either young professionals, students, or individuals who prefer renting over owning due to lifestyle choices. The affordability challenge is significant, as the FMR for a two-bedroom unit is only about $1740, while the actual median rental price is much higher at $246,973. This suggests that the majority of renters in this area must pay more than the FMR to secure a living space, making it difficult for lower-income households to find suitable accommodation. #### Investor Angle From an investor’s perspective, the ZIP code 46112 presents a challenging scenario for cash flow positivity when relying solely on FMR levels. With the actual median rental price for a two-bedroom unit being $246,973, which is 11.8 times the FMR, investors would need to either find units priced below the market average or accept a lower occupancy rate. Given the tight market conditions and high occupancy rates, it is unlikely that many units will be available at FMR levels. Therefore, investors should consider the broader rental market dynamics rather than just focusing on FMR. The investment grade for this ZIP code would be moderate to low, as the reliance on FMR would not yield competitive returns. #### Specific Actionable Insights 1. **Target Lower-Rent Units**: Investors should focus on acquiring units that are priced closer to the FMR levels. For instance, a one-bedroom unit priced at $1500 or a two-bedroom unit priced at $1740 would be more attractive to voucher holders and could potentially offer better occupancy rates. 2. **Diversify Tenant Base**: Given the high price-to-FMR ratio, investors should diversify their tenant base beyond just Section 8 voucher holders. Attracting tenants who can afford market rates would provide a more stable cash flow. This might involve marketing to young professionals or families who have higher incomes and are willing to pay the premium rental prices. #### Bottom Line For Section 8-focused investors, the ZIP code 46112 presents a challenging environment due to the high actual rental prices relative to the FMR. The recommendation for this ZIP code is to **Skip** investing purely based on Section 8 vouchers. Instead, investors should look for areas with a higher proportion of renters and a more favorable price-to-FMR ratio. If considering investment in this area, it would be advisable to target lower-rent units or diversify the tenant mix to include non-voucher holders.

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.