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 | $780 |
| 1 Bedroom | $840 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,300 |
| 4 Bedrooms | $1,490 |
| 5 Bedrooms | $1,728 |
| 6 Bedrooms | $1,935 |
| 7 Bedrooms | $2,090 |
| 8 Bedrooms | $2,195 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,010 | $172,465 | 0.59% | F |
| 3BR | $1,300 | $250,683 | 0.52% | F |
| 4BR | $1,490 | $328,450 | 0.45% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP 47115 (Depauw, IN) reveals interesting insights into potential investment opportunities. The Fair Market Rent (FMR) for a 2-bedroom unit in this area for FY 2024 is set at $950 per month, while the Census ACS reports a market rent of $632 per month for similar units.
To calculate the implied gross yield for both scenarios, we first annualize the monthly rents. For the FMR scenario, the annual rent would be $11,400 ($950 x 12 months), and for the market rent scenario, it would be $7,584 ($632 x 12 months).
Given the median home value of $227,995, the implied gross yield for the FMR scenario is approximately 5%. This is calculated by dividing the annualized FMR rent by the median home value: $11,400 / $227,995 = 0.05, or 5%. In contrast, the implied gross yield for the market rent scenario is roughly 3.3%, calculated as $7,584 / $227,995 = 0.033, or 3.3%.
The FMR scenario suggests a higher gross yield, making it potentially more attractive for investors seeking higher returns. However, the actual rental income may vary depending on the specifics of individual properties and tenant qualifications. The 13.7% renter density in the area indicates that only a portion of the population is likely to be looking for rental housing, which could affect the demand for Section 8 properties.
The N/A-day Days on Market (DOM) figure implies that there is limited data on how quickly rental properties are being leased in this area, which could indicate either a stable market or insufficient data for a precise assessment. Given these factors, the FMR scenario provides a more optimistic gross yield, but investors should consider the lower market rent scenario as a baseline expectation.
In summary, the gross yield for a 2BR property under the FMR scenario is about 5%, while the market rent scenario yields around 3.3%. Investors should weigh these figures against the local rental market dynamics and the specific requirements of Section 8 properties before making investment decisions.
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.