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 | $1,040 |
| 1 Bedroom | $1,220 |
| 2 Bedrooms | $1,420 |
| 3 Bedrooms | $1,720 |
| 4 Bedrooms | $1,870 |
| 5 Bedrooms | $2,169 |
| 6 Bedrooms | $2,429 |
| 7 Bedrooms | $2,623 |
| 8 Bedrooms | $2,754 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,220 | $145,470 | 0.84% | C |
| 2BR | $1,420 | $189,189 | 0.75% | D |
| 3BR | $1,720 | $256,895 | 0.67% | D |
| 4BR | $1,870 | $320,490 | 0.58% | F |
| 5BR | $2,169 | $491,797 | 0.44% | F |
U.S. Census Bureau data (2024)
In ZIP code 46637 of South Bend, IN, investing in Section 8 properties comes with several notable risks that must be carefully considered. Tenant turnover is a significant concern, as the market rent stands at $1,163 compared to the Fair Market Rent (FMR) of $1,130 for FY 2024. This discrepancy can lead to higher churn rates among tenants who might struggle to afford the difference between the FMR and market rent.
Vacancy exposure is another critical issue. The average days on market (DOM) is currently not available, which suggests potential difficulties in accurately predicting how long a property might remain vacant. Given the $251,267 typical home value and a median income of $71,462, deferred maintenance can become a costly problem if not addressed promptly. Landlords should anticipate spending a substantial amount on upkeep and repairs to maintain property standards required by the Section 8 program.
However, these risks are offset by the high renter share of 31.6%. High renter density typically translates into a greater demand for rental properties, including those supported by Section 8 vouchers. This demand can help stabilize occupancy rates and ensure a steady stream of tenants.
The verdict for a first-time Section 8 landlord in ZIP 46637 is moderate risk. While there are significant challenges, particularly with tenant turnover and maintenance costs, the high renter density provides a solid foundation for managing these risks effectively.
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.