Location: Alcona County, MI | Metro: Alcona County, MI
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 | $720 |
| 1 Bedroom | $820 |
| 2 Bedrooms | $1,010 |
| 3 Bedrooms | $1,370 |
| 4 Bedrooms | $1,440 |
| 5 Bedrooms | $1,670 |
| 6 Bedrooms | $1,870 |
| 7 Bedrooms | $2,020 |
| 8 Bedrooms | $2,121 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,370 | $256,446 | 0.53% | F |
U.S. Census Bureau data (2024)
A skeptical investor considering the ZIP code 48740 might raise several valid concerns regarding the feasibility of investing in rental properties here. Let's address these objections head-on using the available data.
Will FMR $1,020 (metro FY 2026) cover the mortgage on a $212,008 home?
The Fair Market Rent (FMR) of $1,020 for the metro area in fiscal year 2026 is a key figure to consider. However, it's important to note that FMR is not a guarantee but rather an estimate used by HUD for setting payment standards. To determine if this FMR can cover the mortgage on a $212,008 home, we must look at the typical interest rates and loan terms. Assuming a 30-year fixed-rate mortgage with an average interest rate of 4%, the monthly mortgage payment would be approximately $1,013. This means the FMR is just enough to cover the mortgage payment, leaving little room for property taxes, insurance, and maintenance costs. Therefore, relying solely on FMR to cover all expenses is risky and requires careful financial planning.
Is there enough renter demand at 15.0%?
The rental vacancy rate of 15.0% in ZIP 48740 raises questions about the competition and demand for rental properties. A higher vacancy rate typically indicates lower demand or higher supply, which could make it difficult to find tenants willing to pay the FMR. However, the vacancy rate alone does not provide a complete picture. We need to examine the local job market, population growth, and other factors that influence rental demand. Unfortunately, the provided data does not include these details, so we cannot conclusively determine whether the demand is sufficient based solely on the vacancy rate.
Will vouchers keep pace with $779 market rents?
The current market rent of $779 in ZIP 48740 is below the FMR, suggesting that voucher holders could potentially cover the full rent amount. However, the concern remains whether voucher amounts will increase to match any future rise in market rents. The Housing Choice Voucher Program adjusts its payment standards periodically based on the FMR, but there is no assurance that these adjustments will always align with local market conditions. Given the current discrepancy between market rents and FMR, it's likely that vouchers will continue to be a viable option for covering rents. Yet, long-term stability depends on how closely the voucher program aligns with local rent trends.
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.