Section 8 Fair Market Rent (FMR) for ZIP 46360 - 2027

Investment Score for ZIP 46360

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	$960
1 Bedroom	$1,030
2 Bedrooms	$1,240
3 Bedrooms	$1,520
4 Bedrooms	$1,750
5 Bedrooms	$2,030
6 Bedrooms	$2,274
7 Bedrooms	$2,456
8 Bedrooms	$2,579

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,030	$189,330	0.54%	F
2BR	$1,240	$177,322	0.7%	D
3BR	$1,520	$236,393	0.64%	D
4BR	$1,750	$350,899	0.5%	F
5BR	$2,030	$639,671	0.32%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 46360 (Michigan City, IN) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 46360, as of 2026, is set at $1090 for a two-bedroom unit. This figure represents the maximum amount that a Section 8 voucher holder can pay towards rent. However, the actual median rent for a two-bedroom unit in Michigan City, according to Zillow, is $172,303. This implies that the price-to-FMR ratio is 13.2x, which means that the actual median rent is significantly higher than the FMR. Given this disparity, voucher holders face significant constraints in finding affordable housing. The FMR is only a fraction of what landlords might charge, making it challenging for voucher recipients to find units within their budget. For instance, a landlord charging the median rent would be asking for approximately $1435 per month, which is well above the $1090 FMR limit for a two-bedroom unit. This situation could lead to voucher holders being forced into lower-quality housing options or having difficulty securing a place to live altogether. #### Affordability & Renter Profile Michigan City has a population of 43,817, with 31.8% of residents being renters. The median household income in the area is $59,266, and the occupancy rate stands at 84.2%. The affordability of housing is a critical issue given that the FMR for a two-bedroom unit is 22.1% of the median income. This indicates that a substantial portion of the median income is dedicated to housing costs, leaving little room for other expenses. The high price-to-FMR ratio suggests that the rental market in Michigan City is relatively tight. With the median rent far exceeding the FMR, it is likely that many potential tenants, especially those relying on Section 8 vouchers, struggle to find suitable housing. This tight market could also mean that there is a limited supply of rental units available at or below the FMR, leading to increased competition among voucher holders. #### Investor Angle From an investor perspective, the ZIP code 46360 presents a mixed picture. While the median rent for a two-bedroom unit is $172,303, the FMR is significantly lower at $1090. This means that if an investor were to purchase a property and rent it out at the FMR, they would be operating at a much lower revenue level compared to the market average. To determine whether this ZIP code is cash-flow positive at FMR, we need to consider the typical operating expenses and mortgage payments associated with rental properties. Assuming a conservative estimate of 50% of the median rent going towards operating expenses and mortgage payments, the net income would be around $86,151.50 annually. At the FMR, the annual income would be $13,080, which is substantially lower. This indicates that properties rented at the FMR would likely have negative cash flow unless the investor can secure a low-cost financing option or the property has minimal operating expenses. In terms of investment grade, Michigan City appears to be a moderate-risk area due to the tight rental market and the challenges faced by voucher holders. Investors should carefully assess the local demand for affordable housing and the likelihood of attracting stable tenants who can meet the FMR requirements. #### Specific Actionable Insights 1. **Target Lower-Rent Properties**: Given the high price-to-FMR ratio, investors should focus on acquiring properties that can be rented out at or near the FMR. This includes smaller units such as one-bedroom or studio apartments, where the FMR is $900 and $830 respectively. These units are more likely to attract Section 8 voucher holders and provide a better chance of positive cash flow. 2. **Consider Property Rehabilitation**: Since the rental market is tight and many voucher holders struggle to find affordable housing, there may be opportunities to acquire older properties at a discount and rehabilitate them to meet the FMR standards. This approach can help create more affordable housing options while potentially generating positive cash flow once the rehabilitation is complete. 3. **Engage with Local Housing Authorities**: To ensure a steady stream of tenants, investors should establish relationships with local housing authorities. This can help in understanding the specific needs of voucher holders and in positioning properties to be attractive to these tenants. Additionally, working closely with housing authorities can provide insights into any upcoming changes in FMR or other policies that might affect the rental market. #### Bottom Line For Section 8-focused investors, Michigan City (ZIP 46360) is a challenging market due to the high price-to-FMR ratio and the tight rental environment. The recommendation would be to **Skip** this ZIP code for now unless you can target very low-cost properties or engage in property rehabilitation projects that can bring units into line with FMR standards. The current dynamics suggest that cash flow will likely be negative for properties rented solely at the FMR, making it a less favorable investment opportunity.

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.