Location: Fort Wayne, IN | Metro: Fort Wayne, IN HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,030 |
| 1 Bedroom | $1,030 |
| 2 Bedrooms | $1,250 |
| 3 Bedrooms | $1,540 |
| 4 Bedrooms | $1,680 |
| 5 Bedrooms | $1,949 |
| 6 Bedrooms | $2,183 |
| 7 Bedrooms | $2,358 |
| 8 Bedrooms | $2,476 |
The analysis of the Section 8 cap-rate scenario for ZIP code 46856 in Unknown, Indiana, requires an understanding of the Fair Market Rent (FMR) and the median home value. For FY 2024, the annualized FMR for a two-bedroom property in ZIP 46856 is set at $1090 per month. However, the market rent for this area is currently not available, indicating a lack of recent data on what landlords might typically charge.
To calculate the implied gross yield, we would normally compare the annualized FMR against the median home value. Unfortunately, the median home value for ZIP 46856 is also not available, making it impossible to provide a precise cap-rate calculation based on these figures. The cap rate is calculated as the net operating income divided by the property's value, but without the median home value, we can only discuss the gross yield, which is the rental income before expenses.
In the scenario where the FMR is used as the basis for calculating the gross yield, the annual rental income would be $13,080 ($1090 x 12 months). This figure represents the maximum amount that a landlord could receive annually through the Section 8 program for a two-bedroom unit. Without the median home value, we cannot state a specific gross yield percentage, but it is clear that this income level would need to be considered alongside the costs associated with owning and maintaining the property.
The lack of market rent data and median home value suggests that there may be limited recent sales activity or rental listings in ZIP 46856. This absence of information makes it difficult to gauge how realistic the FMR-based gross yield is compared to potential market rents. Additionally, the renter density and days on market (DOM) are not provided, which are critical factors in determining the likelihood of finding tenants and the overall demand for rental properties in this area.
Given the incomplete data, it is advisable for landlords and small-portfolio investors to conduct thorough local market research. They should consider reaching out to local real estate agents or examining historical trends to better understand the potential rental income and property values. This additional research will help in making informed decisions about the profitability of investing in ZIP 46856 under the Section 8 program.
In conclusion, while the FMR provides a clear benchmark for rental income, the lack of other key data points means that investors must exercise caution and gather more localized information to assess the true cap-rate potential and gross yield for properties in ZIP 46856.
Data Sources: FMR data from HUD (2027).
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.