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 | $1,530 |
| 1 Bedroom | $1,720 |
| 2 Bedrooms | $1,980 |
| 3 Bedrooms | $2,570 |
| 4 Bedrooms | $3,130 |
| 5 Bedrooms | $3,631 |
| 6 Bedrooms | $4,067 |
| 7 Bedrooms | $4,392 |
| 8 Bedrooms | $4,612 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,720 | $239,073 | 0.72% | D |
| 2BR | $1,980 | $317,675 | 0.62% | D |
| 3BR | $2,570 | $349,353 | 0.74% | D |
| 4BR | $3,130 | $577,953 | 0.54% | F |
| 5BR | $3,631 | $682,467 | 0.53% | F |
U.S. Census Bureau data (2024)
The ZIP code 46202 is located in Indianapolis, IN, and represents a densely populated urban neighborhood with over 20,180 residents. This area stands out due to its high percentage of renters, at 70.6%, indicating a strong demand for rental properties. The median household income in this neighborhood is $63,506, suggesting a middle-class demographic capable of paying moderate rents. Median home values in ZIP 46202 are relatively high at $346,035, reflecting a mix of owner-occupied homes and rental units.
When it comes to the economics of renting in ZIP 46202, the Federal Market Rent (FMR) for the fiscal year 2024 is set at $1,640. This figure is notably higher than the market rent, which is currently estimated at $1,428 (ZORI). The discrepancy between the FMR and the ZORI highlights an opportunity for landlords and small-portfolio investors who can leverage the higher FMR to secure Section 8 tenants while still maintaining competitive market rates.
Given these conditions, ZIP 46202 is well-suited for both hands-off voucher operators and hands-on value-add buyers. For hands-off operators, the area's high renter ratio and favorable FMR-to-ZORI ratio make it ideal for generating steady cash flow through Section 8 tenancy without the need for extensive property management. On the other hand, hands-on investors can benefit from the potential to increase property values and rents over time, given the existing economic parameters and the neighborhood's characteristics.
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.