Location: Terre Haute, IN | Metro: Terre Haute, IN HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $910 |
| 1 Bedroom | $920 |
| 2 Bedrooms | $1,190 |
| 3 Bedrooms | $1,420 |
| 4 Bedrooms | $1,650 |
| 5 Bedrooms | $1,914 |
| 6 Bedrooms | $2,144 |
| 7 Bedrooms | $2,316 |
| 8 Bedrooms | $2,432 |
The analysis for Section 8 properties in ZIP code 47870 is based on the Fair Market Rent (FMR) set at $980 for fiscal year 2024. However, due to the lack of available data on the current market rent for this area, it's impossible to calculate the exact gap between FMR and market rent. Despite this limitation, understanding the implications of the FMR can still provide valuable insights for landlords and small-portfolio investors.
If the FMR of $980 exceeds the actual market rent in ZIP 47870, then properties participating in the Section 8 program become a yield play. This means that landlords could potentially receive higher rents from voucher tenants compared to what they might get from regular market-rate tenants. The increased rental income can lead to better financial returns on their investment properties. For instance, if the market rent is significantly lower than $980, say $700, then the gap would be $280 per month, representing a 40% increase in rental income. This scenario makes Section 8 participation attractive for those looking to maximize cash flow.
On the other hand, if the market rent is above the FMR, landlords accepting Section 8 tenants will be renting below the open-market rate. This can be seen as an opportunity cost, where the landlord might be leaving money on the table by not charging market rates. The decision to participate in the program under these conditions would need to be weighed against the stability and reliability of rental income provided by the government-subsidized vouchers.
ZIP 47870 currently has N/A% of residents who are renters, indicating a N/A median home value and a N/A median income. These figures suggest that the local economy and housing market dynamics should also be considered when evaluating the potential benefits and drawbacks of accepting Section 8 tenants. Landlords must balance the financial benefits of higher guaranteed income against the potential risks and costs associated with managing subsidized housing.
Data Sources: FMR data from HUD (2027).
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.