Location: Kokomo, IN | Metro: Tipton County, 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 | $920 |
| 1 Bedroom | $920 |
| 2 Bedrooms | $1,190 |
| 3 Bedrooms | $1,430 |
| 4 Bedrooms | $1,650 |
| 5 Bedrooms | $1,914 |
| 6 Bedrooms | $2,144 |
| 7 Bedrooms | $2,316 |
| 8 Bedrooms | $2,432 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $920 | $78,391 | 1.17% | B |
| 2BR | $1,190 | $132,287 | 0.9% | C |
| 3BR | $1,430 | $199,273 | 0.72% | D |
| 4BR | $1,650 | $289,617 | 0.57% | F |
| 5BR | $1,914 | $360,528 | 0.53% | F |
U.S. Census Bureau data (2024)
The ZIP code 46902, located in Kokomo, Indiana, presents an interesting scenario when viewed through the lens of rental affordability. The median income for households in this area stands at $62,126. Given the market rate rent of $1,055 per month (ZORI), it becomes clear that a significant portion of residents face challenges in affording housing without assistance.
To put this into perspective, the Fair Market Rent (FMR) for the zip code for fiscal year 2024 is set at $1,020. This means that the government subsidy through housing vouchers aims to cover a monthly rent amount close to the market rate, but slightly lower. For a household earning the median income, paying $1,055 in rent would require allocating approximately 20% of their annual income towards housing, which is within the recommended threshold for affordability but leaves little room for other expenses.
Kokomo has a population of 37,017, with 33.0% of its residents being renters. This indicates a substantial demand for rental properties. However, the affordability gap between the median income and the ZORI suggests that many potential tenants might struggle to pay the market rate without financial aid. Consequently, landlords in this area must be prepared to compete with those who accept housing vouchers, as these vouchers can make the difference in securing a tenant.
The takeaway for landlords considering voucher versus cash-pay strategies is straightforward: accepting vouchers can broaden your pool of potential tenants, especially in a market where the median income is relatively low compared to the rent. While vouchers offer a steady stream of income guaranteed by the government, they typically pay out slightly less than the market rate ($1,020 vs. $1,055). Landlords should weigh the benefits of consistent, government-backed payments against the potential for higher rents from cash-paying tenants.
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.