Section 8 Fair Market Rent (FMR) for ZIP 48748 - 2027

FY 2027 Fair Market Rent Rates

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

Housing Authorities Serving ZIP 48748

• East Tawas Housing Commission (East Tawas, MI)

If you are considering purchasing a property in ZIP code 48748, Tawas City, Michigan, for Section 8 investment, follow these steps to make an informed decision:

Step 1: Can the Fair Market Rent (FMR) of $970 cover the debt service on a $148,584 property?

• Yes. The FMR of $970 is likely sufficient to cover the debt service on a property valued at $148,584. Typically, a property's debt service (the total amount paid for principal and interest on a mortgage) can be estimated using the FMR. In this case, the FMR exceeds the average monthly mortgage payment for a property of this value, assuming standard financing terms.

Step 2: How does the market rent of $675 compare to the FMR?

• Below FMR. The market rent of $675 is below the FMR of $970. This indicates that properties in Tawas City are generally less expensive to rent than what the government considers fair for Section 8 purposes. However, this also means that landlords could potentially receive higher rents by participating in the Section 8 program compared to the local market rates.

Step 3: Is there enough rental demand in Tawas City?

• It depends. The rental demand is indicated by 7.7% of residents being renters, but the lack of data on days on market (DOM) makes it difficult to assess how quickly rentals turn over. A high percentage of renters might suggest strong demand, but without knowing the DOM, it's unclear if there are enough new tenants entering the market to keep properties filled. Additionally, the lower market rent suggests that some tenants might prefer non-Section 8 units if they can afford them, which could impact the demand for Section 8 properties.

In conclusion, based on the given data, Tawas City appears to offer a favorable environment for Section 8 investment due to the FMR covering debt service and being higher than the market rent. However, the rental demand is somewhat ambiguous due to limited information on the DOM. Landlords should consider these factors carefully before making an investment decision.

Data Sources: FMR data from HUD (2027). 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.