Location: South Bend-Mishawaka, IN | Metro: South Bend-Mishawaka, 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 | $870 |
| 1 Bedroom | $1,020 |
| 2 Bedrooms | $1,190 |
| 3 Bedrooms | $1,440 |
| 4 Bedrooms | $1,560 |
| 5 Bedrooms | $1,810 |
| 6 Bedrooms | $2,027 |
| 7 Bedrooms | $2,189 |
| 8 Bedrooms | $2,298 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,190 | $106,009 | 1.12% | B |
| 3BR | $1,440 | $176,921 | 0.81% | C |
| 4BR | $1,560 | $152,403 | 1.02% | B |
| 5BR | $1,810 | $135,141 | 1.34% | A |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP 46619 in South Bend, IN, provides a detailed insight into potential investment yields. Using the Fair Market Rent (FMR) for a 2-bedroom unit at $990 per month as stipulated for FY 2024, and the market rent at $993 per month based on Census ACS data, we can derive the gross yield for properties in this area.
Annualizing the FMR, a 2BR unit would generate an annual income of $11,880 ($990 x 12 months). Against the median home value of $134,732, this translates to a gross yield of approximately 8.82%. This calculation is straightforward and reflects the maximum possible yield under Section 8 guidelines.
Using the market rent figure, the annual income would be $11,916 ($993 x 12 months). The gross yield here is slightly higher at about 8.85%. This scenario assumes that the property could command a slightly higher rent outside of Section 8, reflecting market conditions.
The renter density in ZIP 46619 stands at 25.7%, indicating a moderate demand for rental properties. However, the N/A-day DOM (Days on Market) suggests either a very efficient rental market or incomplete data, making it difficult to assess the exact turnover rates. Given these conditions, the FMR-based gross yield of 8.82% is more realistic for most landlords participating in the Section 8 program. While the market rent scenario offers a marginally better gross yield, the practicality of securing tenants willing to pay above the FMR in a program where rents are capped is questionable.
In conclusion, for landlords and small-portfolio investors considering Section 8 properties in ZIP 46619, the gross yield of 8.82% should be the primary focus. This yield, while not exceptionally high, aligns with the realities of the rental market and the constraints of the Section 8 program.
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.