Section 8 Fair Market Rent (FMR) for ZIP 48307 - 2027

Investment Score for ZIP 48307

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	$1,350
1 Bedroom	$1,500
2 Bedrooms	$1,880
3 Bedrooms	$2,290
4 Bedrooms	$2,490
5 Bedrooms	$2,888
6 Bedrooms	$3,235
7 Bedrooms	$3,494
8 Bedrooms	$3,669

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
1BR	$1,500	$148,259	1.01%	B
2BR	$1,880	$271,202	0.69%	D
3BR	$2,290	$401,882	0.57%	F
4BR	$2,490	$578,320	0.43%	F
5BR	$2,888	$679,717	0.42%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 48307 (Rochester Hills, MI) #### Introduction Rochester Hills, located in Oakland County, Michigan, is a suburban community known for its high quality of life, excellent schools, and low crime rates. The ZIP code 48307 has a population of 44,714, with a median household income of $106,576, indicating a relatively affluent area. However, with 33.0% of residents being renters and an occupancy rate of 95.2%, there is a significant demand for rental housing. This analysis will focus on the dynamics of Section 8 vouchers, affordability, renter profile, investor angle, and actionable insights for the market. #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP 48307 in 2026 is set at: - 0BR: $1290 - 1BR: $1440 - 2BR: $1810 (20.4% of median income) - 3BR: $2210 - 4BR: $2400 These figures represent the maximum amount that a Section 8 voucher holder can pay towards their rent. In Rochester Hills, the actual rents often exceed these FMRs, particularly for two-bedroom units where the Zillow median price is $271,348. Given the price-to-FMR ratio of 12.5x for a 2BR unit, it is clear that actual rents are significantly higher than the FMRs. For instance, if a 2BR unit costs $271,348, the monthly rent would be approximately $2,261, which is already above the FMR of $1810. This means that voucher holders face significant constraints in finding affordable housing within the limits of their vouchers. #### Affordability & Renter Profile With a median household income of $106,576, Rochester Hills is generally considered an upper-middle-class area. Despite this, the 33.0% renter population suggests a diverse demographic mix, including families, young professionals, and retirees who prefer renting over owning. The occupancy rate of 95.2% indicates a tight rental market, with limited availability and strong competition among renters. This tightness is further exacerbated by the high price-to-FMR ratio, making it challenging for low-income households to find suitable housing options. #### Investor Angle From an investor perspective, the ZIP code 48307 presents both opportunities and challenges. While the high median household income and tight rental market suggest strong demand for rental properties, the FMRs are notably lower than the actual market rents. For example, a 2BR unit with an actual rent of $2,261 would only receive $1810 under a Section 8 voucher, resulting in a shortfall of $451 per month. This shortfall could impact the cash flow positively if the property is priced below market rates but negatively if priced at market rates. To determine the investment grade, we need to consider factors such as vacancy rates, property values, and the overall economic stability of the area. Given the high occupancy rate and strong demand, the investment grade is likely to be good, provided that the investor can manage the financial constraints associated with Section 8 vouchers. #### Specific Actionable Insights 1. **Focus on Properties Below Market Rates**: Investors should look for properties that are priced below the market average. For instance, a 2BR unit priced at $1,800 per month would be fully covered by a Section 8 voucher, ensuring positive cash flow. This strategy can help mitigate the risk of financial shortfalls. 2. **Consider Multi-Family Units**: Given the higher FMRs for larger units, multi-family properties such as duplexes or small apartment buildings might offer better returns. A 3BR unit priced at $2,200 would be close to the FMR limit, providing a manageable gap between the voucher amount and the actual rent. 3. **Engage with Local Housing Authorities**: Building relationships with local housing authorities can provide insights into the demand for Section 8 vouchers and potential opportunities for securing tenants. This can also help in navigating the complexities of the voucher program and ensuring compliance with regulations. #### Bottom Line For Section 8-focused investors, the ZIP code 48307 presents a mixed scenario. While the strong rental market and high median income suggest robust demand, the high price-to-FMR ratio poses significant challenges in terms of affordability and cash flow management. Therefore, the recommendation is to **Hold** investments in this ZIP code, focusing on properties that are priced below market rates and engaging closely with local housing authorities to ensure compliance and tenant acquisition. This approach can help maximize returns while maintaining positive cash flow.

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.