Location: Detroit-Warren-Livonia, MI | Metro: Detroit-Warren-Livonia, MI 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 | $850 |
| 1 Bedroom | $950 |
| 2 Bedrooms | $1,190 |
| 3 Bedrooms | $1,450 |
| 4 Bedrooms | $1,570 |
| 5 Bedrooms | $1,821 |
| 6 Bedrooms | $2,040 |
| 7 Bedrooms | $2,203 |
| 8 Bedrooms | $2,313 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $950 | $150,828 | 0.63% | D |
| 2BR | $1,190 | $236,123 | 0.5% | F |
| 3BR | $1,450 | $282,934 | 0.51% | F |
| 4BR | $1,570 | $369,414 | 0.42% | F |
| 5BR | $1,821 | $431,113 | 0.42% | F |
U.S. Census Bureau data (2024)
The classification of ZIP 48001 (Algonac, MI) reveals a unique balance between yield and stability that can guide real estate investment decisions.
On the yield axis, the Fair Market Rent (FMR) for ZIP 48001 in fiscal year 2024 is set at $1,210. This compares favorably against the local market rent of $944, indicating a potential for higher rental income when utilizing Section 8 vouchers. Additionally, the average home value in this area is $249,794, which provides a context for property appreciation and equity growth over time.
Regarding stability, the ZIP code has a relatively low percentage of renters at 13.7%. While this figure suggests that the majority of residents are homeowners, it also implies a smaller pool of potential tenants who might rely on Section 8 vouchers. The lack of data on days on market (DOM) makes it challenging to assess how quickly properties are rented out, but the median household income of $69,160 offers insight into the economic health of the area and the ability of residents to afford housing.
Considering these factors, ZIP 48001 does not fit neatly into either a high-yield/low-stability flip-style market or a steady-cashflow zone. Instead, it represents an area with moderate potential for rental income enhancement through Section 8 participation, balanced by a lower risk of tenant turnover due to the high proportion of homeowners. The higher FMR compared to the market rent suggests a reasonable yield improvement opportunity, while the income level indicates a stable economic environment.
To conclude, ZIP 48001 is best described as a market offering moderate yield improvements and stability. It is suitable for investors looking to leverage Section 8 vouchers for better cash flow without the volatility associated with purely speculative investments. The combination of higher FMRs and solid median incomes supports this assessment, making it a viable option for those seeking a balanced approach to real estate investment.
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.