Location: Arenac County, MI | Metro: Bay City, MI MSA
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 | $730 |
| 1 Bedroom | $790 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,360 |
| 4 Bedrooms | $1,700 |
| 5 Bedrooms | $1,972 |
| 6 Bedrooms | $2,209 |
| 7 Bedrooms | $2,386 |
| 8 Bedrooms | $2,505 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,010 | $138,389 | 0.73% | D |
| 3BR | $1,360 | $187,819 | 0.72% | D |
| 4BR | $1,700 | $206,634 | 0.82% | C |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP 48658 (Standish, MI) reveals some interesting dynamics when comparing Federal Market Rent (FMR) and market rent against the median home value.
Using the annualized 2BR FMR of $910 for FY 2024, the implied gross yield can be calculated as follows:
$910 annualized rent divided by the median home value of $152,884 yields an implied gross yield of approximately 0.6%. This calculation is based on the assumption that the property value accurately reflects the rental income potential under the Section 8 program.
In contrast, using the market rent figure of $711 from the Census ACS, the implied gross yield is significantly lower at about 0.46%. This suggests that the actual market conditions may offer a less favorable return compared to what the Section 8 program might provide.
To determine which scenario is more realistic, consider the 21.1% renter density in Standish. This relatively low percentage indicates that a substantial portion of the population may prefer homeownership over renting, which could affect the demand for rental properties and thus the effectiveness of market rents as a benchmark.
The N/A-day DOM (Days on Market) data complicates the analysis slightly, as it does not provide insight into how quickly rental units turn over. However, given the low renter density, it is reasonable to infer that market rents may struggle to match the stability and predictability offered by Section 8 rents.
The 0.6% gross yield implied by the FMR is more likely to represent a stable investment opportunity, whereas the 0.46% gross yield from market rents reflects a potentially riskier and less consistent revenue stream.
Landlords and small-portfolio investors should weigh these figures carefully, considering the trade-offs between the guaranteed income stability of Section 8 versus the fluctuating market rents. The higher gross yield from FMR aligns better with the local preference for homeownership, suggesting that Section 8 participation could be a more reliable strategy for generating steady rental income.
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.