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 | $1,110 |
| 1 Bedroom | $1,240 |
| 2 Bedrooms | $1,550 |
| 3 Bedrooms | $1,890 |
| 4 Bedrooms | $2,050 |
| 5 Bedrooms | $2,378 |
| 6 Bedrooms | $2,663 |
| 7 Bedrooms | $2,876 |
| 8 Bedrooms | $3,020 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,550 | $188,299 | 0.82% | C |
| 3BR | $1,890 | $262,967 | 0.72% | D |
| 4BR | $2,050 | $476,398 | 0.43% | F |
| 5BR | $2,378 | $599,366 | 0.4% | F |
U.S. Census Bureau data (2024)
The classification of ZIP 48127 (Dearborn Heights, MI) on the axes of yield and stability reveals it as a moderate opportunity for landlords and small-portfolio investors. The Fair Market Rent (FMR) for the fiscal year 2024 is set at $1,340, which is notably lower than the market rent of $1,547. This suggests that while there is potential for above-FMR rents, it is not a high-yield market due to the relatively low FMR figure compared to the median home value of $259,428.
On the stability axis, the area shows a mixed profile. With 28.0% of residents being renters, the market has a decent but not overwhelming rental base. The absence of data regarding the average days on market (DOM) indicates an incomplete picture of the rental turnover rate, which is critical for assessing the ease of tenant acquisition and retention. However, the median household income of $60,742 provides some assurance that tenants have the financial capability to meet their rent obligations, contributing to overall stability.
Given these metrics, ZIP 48127 does not fit neatly into either a high-yield/low-stability 'flip-style' market or a steady-cashflow zone. Instead, it represents a middle ground where the potential for higher-than-average yields exists, but it is tempered by the need for careful management to maintain stable occupancy rates. Landlords should consider the local rental demand and the competitive landscape before setting their rental prices to ensure they maximize their returns while maintaining a stable tenant base.
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.