Location: Washington County, IN | Metro: Louisville, KY-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 | $800 |
| 1 Bedroom | $860 |
| 2 Bedrooms | $1,050 |
| 3 Bedrooms | $1,330 |
| 4 Bedrooms | $1,520 |
| 5 Bedrooms | $1,763 |
| 6 Bedrooms | $1,975 |
| 7 Bedrooms | $2,133 |
| 8 Bedrooms | $2,240 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,050 | $200,281 | 0.52% | F |
| 3BR | $1,330 | $294,639 | 0.45% | F |
| 4BR | $1,520 | $408,187 | 0.37% | F |
U.S. Census Bureau data (2024)
A landlord considering investing in ZIP code 47106 for Section 8 properties must follow a decision tree based on the following criteria:
1) Does the Fair Market Rent (FMR) of $1160 cover the debt service on a property valued at $305,703?
To determine if the FMR can cover the debt service, calculate the monthly mortgage payment for a $305,703 property. Assuming a typical mortgage rate of 4% and a 30-year term, the monthly mortgage payment would be approximately $1,460. The FMR of $1160 does not cover this amount, leading to a no. This means that relying solely on Section 8 income is insufficient to meet the financial obligations of the property.
2) Is the market rent of $943 above, at, or below the FMR?
The market rent of $943 is below the FMR of $1160. This indicates that the rental market in ZIP 47106 is not competitive with the FMR, suggesting that landlords might struggle to find tenants willing to pay the higher FMR rates. This leads to an it depends. Landlords who can attract market-rate tenants might still find the area viable, but those relying solely on Section 8 might face challenges.
3) Are 18.4% renters combined with N/A-day days on market (DOM) enough demand?
The percentage of renters at 18.4% suggests moderate demand for rental properties. However, without knowing the average DOM, it's challenging to assess the overall market dynamics accurately. A lower DOM indicates quicker property turnover, which is favorable for landlords. Since the DOM data is not available, the answer is again an it depends. If the DOM is low, the market could support rental properties, but if it's high, finding tenants might be difficult.
In conclusion, ZIP 47106 presents mixed signals for Section 8 investment. The FMR is insufficient to cover debt service, and the market rent is below FMR. Without precise DOM data, the final recommendation hinges on the ability to attract a mix of market-rate and Section 8 tenants. If the DOM is low, landlords might find the area acceptable despite the challenges. Otherwise, look for areas where the FMR covers debt service and the market rent is at least at the FMR level.
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.