Section 8 Fair Market Rent (FMR) for ZIP 48071 - 2027
Location: Detroit-Warren-Livonia, MI | Metro: Detroit-Warren-Livonia, MI HUD Metro FMR Area
Investment Score for ZIP 48071
C
Monthly Rent (2BR)
$1,430
Median Price (2BR)
$156,259
Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)
FY 2027 Fair Market Rent Rates
| Unit Size |
Monthly FMR |
| Studio | $1,030 |
| 1 Bedroom | $1,140 |
| 2 Bedrooms | $1,430 |
| 3 Bedrooms | $1,740 |
| 4 Bedrooms | $1,890 |
| 5 Bedrooms | $2,192 |
| 6 Bedrooms | $2,455 |
| 7 Bedrooms | $2,651 |
| 8 Bedrooms | $2,784 |
Investment Analysis by Bedroom Size
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms |
Monthly FMR |
Median Price |
1% Rule |
Grade |
| 2BR |
$1,430 |
$156,259 |
0.92% |
C |
| 3BR |
$1,740 |
$230,250 |
0.76% |
D |
| 4BR |
$1,890 |
$272,567 |
0.69% |
D |
| 5BR |
$2,192 |
$283,782 |
0.77% |
D |
Demographics & Housing Statistics
U.S. Census Bureau data (2024)
Median Household Income
$69,503
When considering whether to invest in ZIP 48071 (Madison Heights, MI) for Section 8 properties, follow these steps:
- Does the FMR of $1300 cover debt service on a $219,540 property?
- Yes: The Fair Market Rent (FMR) of $1300 is sufficient to cover typical debt service costs for a property valued at $219,540. This makes the investment viable from a financial standpoint.
- No: If the FMR does not cover debt service, investing in ZIP 48071 would not be advisable. Debt service costs must be met for the investment to be sustainable.
- Is the ZORI of $1,564 above, at, or below the FMR?
- Above: The Zillow Rent Index (ZORI) of $1,564 is higher than the FMR of $1300, indicating that market rents exceed the Section 8 payment standards. Landlords can potentially charge the difference between the FMR and ZORI, increasing profitability.
- At: If ZORI matches the FMR exactly, there is no additional margin for charging extra rent beyond what is covered by the FMR. This scenario offers stable but limited upside potential.
- Below: A ZORI below the FMR suggests that market rents are lower than the government's payment standard, which is unlikely given the current figures. In such a case, the investment would still be viable due to the guaranteed income from the FMR.
- Are 35.2% renters combined with a 20-day days-on-market (DOM) indicative of enough demand?
- Yes: With 35.2% of the population renting and an average DOM of 20 days, there is strong demand for rental properties. This indicates a healthy market where properties are quickly leased, reducing vacancy rates and ensuring steady cash flow.
- No: If the percentage of renters is significantly lower or the DOM is much longer, the demand for rentals would be insufficient. However, based on the provided data, the demand in ZIP 48071 is adequate.
- It Depends: For areas with rental percentages around 35.2% and DOM around 20 days, the decision to invest hinges on other factors such as competition, property condition, and local economic stability.
In conclusion, ZIP 48071 presents a favorable environment for Section 8 investments if the FMR of $1300 sufficiently covers debt service costs on a property valued at $219,540. The market rent being higher than the FMR provides an additional revenue stream. Lastly, the combination of 35.2% renters and a 20-day DOM suggests a robust demand for rental properties, making the investment attractive.
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.