Location: Gibson County, IN | Metro: Evansville, IN MSA
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 | $900 |
| 1 Bedroom | $910 |
| 2 Bedrooms | $1,170 |
| 3 Bedrooms | $1,440 |
| 4 Bedrooms | $1,600 |
| 5 Bedrooms | $1,856 |
| 6 Bedrooms | $2,079 |
| 7 Bedrooms | $2,245 |
| 8 Bedrooms | $2,357 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,170 | $191,637 | 0.61% | D |
| 3BR | $1,440 | $267,525 | 0.54% | F |
| 4BR | $1,600 | $424,177 | 0.38% | F |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 47613, located in Elberfeld, Indiana, provides insight into the potential returns for landlords and small-portfolio investors. The Fair Market Rent (FMR) for a two-bedroom apartment in fiscal year 2024 is set at an annualized rate of $1200. Meanwhile, the market rent based on Census ACS data stands at $775 annually.
To derive the gross yield for these scenarios, we must first calculate the annual rental income. For the Section 8 scenario, using the FMR, the annual rental income would be $1200. For the market rent scenario, it would be $775. Given the median home value in the area is $263,629, we can then calculate the gross yields:
The implied gross yield for the Section 8 scenario is significantly higher at 0.45% compared to the market rent scenario's 0.29%. However, this does not account for the operational costs that landlords would incur. Given the 2.9% renter density in the area, the market rent scenario appears more realistic. Renter density suggests the number of potential tenants who might qualify for Section 8 assistance is relatively low, which could make it challenging to find tenants willing to pay the higher Section 8 rate.
The N/A-day Days on Market (DOM) indicates that there is no specific data available regarding how long properties typically remain unsold or unrented before finding a tenant. This lack of information makes it difficult to predict vacancy rates accurately, which is crucial for calculating the net operating income (NOI).
In conclusion, while the Section 8 scenario offers a higher gross yield, the actual return on investment may be lower due to the limited pool of eligible tenants and operational costs. Landlords should consider these factors when deciding whether to participate in the Section 8 program or seek market-rate tenants. The market rent scenario, despite offering a lower gross yield, aligns better with the local renter density and might present a more stable and predictable income stream.
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.