Location: Terre Haute, IN | Metro: Terre Haute, 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 | $780 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,210 |
| 4 Bedrooms | $1,410 |
| 5 Bedrooms | $1,636 |
| 6 Bedrooms | $1,832 |
| 7 Bedrooms | $1,979 |
| 8 Bedrooms | $2,078 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $780 | $73,168 | 1.07% | B |
| 2BR | $1,010 | $109,061 | 0.93% | C |
| 3BR | $1,210 | $203,209 | 0.6% | F |
| 4BR | $1,410 | $295,566 | 0.48% | F |
U.S. Census Bureau data (2024)
The median income in ZIP 47885, which encompasses West Terre Haute, IN, stands at $67,588. Considering the market rate rent of $721 based on Census ACS data, it becomes evident that a significant portion of households may struggle to meet these costs comfortably. For context, the Federal Market Rent (FMR) standard for zip code 47885 in fiscal year 2024 is set at $870, which is notably higher than the current market rate.
To put this into perspective, let's break down the numbers. A household earning the median income of $67,588 would have an annual disposable income of approximately $5,632 after accounting for basic living expenses. This leaves around $469 per month for discretionary spending, including rent. The market rate of $721 exceeds this amount by $252, indicating that many residents would need to cut other expenses or seek financial assistance to cover their housing costs.
The affordability gap is further highlighted when comparing the FMR of $870 to the market rate of $721. This discrepancy suggests that landlords might face challenges in attracting tenants who can afford the higher FMR rates without government assistance. Given that only 18.8% of the 9,209 population are renters, competition among landlords could be intense, especially for those willing to accept lower rents or offer more affordable options.
The takeaway for landlords considering voucher versus cash-pay strategies is clear: accepting vouchers can be a viable option to secure tenants in a competitive rental market. While the voucher payment standard of $870 aligns with the FMR, it ensures a steady stream of rental income, even if it's slightly below the market rate. Landlords should weigh the benefits of guaranteed payments against the administrative complexities of managing voucher programs.
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.