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 | $1,220 |
| 1 Bedroom | $1,360 |
| 2 Bedrooms | $1,700 |
| 3 Bedrooms | $2,070 |
| 4 Bedrooms | $2,250 |
| 5 Bedrooms | $2,610 |
| 6 Bedrooms | $2,923 |
| 7 Bedrooms | $3,157 |
| 8 Bedrooms | $3,315 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,700 | $195,568 | 0.87% | C |
| 3BR | $2,070 | $362,379 | 0.57% | F |
| 4BR | $2,250 | $511,381 | 0.44% | F |
| 5BR | $2,610 | $687,870 | 0.38% | F |
U.S. Census Bureau data (2024)
The potential risks for Section 8 investments in ZIP code 48138, located in Grosse Ile, Michigan, are significant and should be carefully considered before making any financial commitments. Firstly, tenant turnover poses a challenge due to the difference between the market rent of $1,414 and the Fair Market Rent (FMR) set at $1,530 for fiscal year 2024. This discrepancy can lead to higher costs associated with finding and retaining tenants who qualify for the program.
Vacancy exposure is another critical factor, although the data on days on market (DOM) is currently unavailable. In areas with high housing values, such as ZIP 48138 where the typical home value is $394,298, maintaining a property in good condition is essential to attract and keep tenants. The deferred maintenance risk is elevated given the relatively low median income of $126,582, which may limit the ability of residents to afford higher rents outside of government assistance programs.
Despite these risks, there is a notable 8.1% renter share in the area, indicating a high concentration of potential voucher holders. A dense population of renters generally translates into a higher demand for subsidized housing, which can mitigate some of the financial uncertainties associated with vacancy rates. Landlords and small-portfolio investors should leverage this information to understand the local rental market dynamics and prepare accordingly.
In summary, the combination of market vs. FMR rent differences, unknown vacancy rates, and the need for regular maintenance makes ZIP 48138 a moderate risk for first-time Section 8 landlords. However, the high renter density provides a buffer that can help offset these challenges.
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.