Location: Switzerland County, IN | Metro: Jefferson County, IN
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 | $750 |
| 1 Bedroom | $850 |
| 2 Bedrooms | $1,030 |
| 3 Bedrooms | $1,300 |
| 4 Bedrooms | $1,610 |
| 5 Bedrooms | $1,868 |
| 6 Bedrooms | $2,092 |
| 7 Bedrooms | $2,259 |
| 8 Bedrooms | $2,372 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $850 | $152,941 | 0.56% | F |
| 2BR | $1,030 | $186,033 | 0.55% | F |
| 3BR | $1,300 | $242,013 | 0.54% | F |
| 4BR | $1,610 | $338,012 | 0.48% | F |
| 5BR | $1,868 | $447,866 | 0.42% | F |
U.S. Census Bureau data (2024)
The analysis of the Section 8 program in ZIP code 47250, centered around Madison, Indiana, reveals a significant gap between the Fair Market Rent (FMR) and the actual market rent. The FMR for the metro area in fiscal year 2026 is set at $960, while the Census ACS reports the market rent at $892. This creates a $68 gap, which translates to a 7.7% difference favoring the FMR.
This gap means that landlords can receive higher rents through Section 8 vouchers than what the open market currently offers. Specifically, the voucher rate is $68 more per month than the average market rate. In the context of Madison, where 30.8% of residents are renters, and the median income stands at $61,284, the higher rental income from Section 8 vouchers can be a substantial yield play for landlords. It provides a financial incentive to participate in the program, especially when considering the median home value in the area is $239,116, indicating a mix of affordability and value.
The fact that the FMR exceeds the market rent suggests that voucher tenants are effectively subsidizing the local rental market. Landlords who accept Section 8 vouchers in ZIP 47250 can benefit from this subsidy, potentially increasing their cash flow and investment returns. However, it's important to note that there are also administrative costs associated with participating in the Section 8 program, such as regular inspections and paperwork, which must be factored into the overall cost-benefit analysis.
In summary, the $68 premium on Section 8 voucher rents over market rates makes this a compelling opportunity for landlords in Madison, Indiana. This premium, combined with the stable and guaranteed nature of the rental income, positions Section 8 as a strategic asset for those looking to maximize yields in a rental market that is otherwise below the FMR threshold.
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.