Location: Hillsdale County, MI | Metro: Hillsdale 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 | $800 |
| 2 Bedrooms | $1,040 |
| 3 Bedrooms | $1,300 |
| 4 Bedrooms | $1,370 |
| 5 Bedrooms | $1,589 |
| 6 Bedrooms | $1,780 |
| 7 Bedrooms | $1,922 |
| 8 Bedrooms | $2,018 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,300 | $301,271 | 0.43% | F |
U.S. Census Bureau data (2024)
A skeptical investor might question whether the Fair Market Rent (FMR) of $1,020 for ZIP 49232 can sufficiently cover the mortgage on a home valued at $244,488. To address this concern, it's important to note that the FMR represents the average rent for a two-bedroom apartment, which may not directly correlate with the rental income potential of a single-family home. However, using the FMR as a benchmark, one could reasonably expect a single-family home to command a higher rental rate, potentially covering a mortgage and providing a profit margin.
The demand for rental properties in ZIP 49232 stands at 15.9%. This figure may seem low to some investors, who might argue that it indicates insufficient demand to support a profitable rental portfolio. While 15.9% does suggest a less competitive market, it's essential to consider the broader context. According to recent trends, the median sales price in the area is around $211,976.67, indicating that the cost of entry into the rental market is relatively low. Additionally, the total number of properties sold in the past year is 47, suggesting that while the rental market may not be booming, it still offers opportunities for steady, if not rapid, growth.
Another objection could be whether housing vouchers will keep pace with the current market rents of $835. It's true that voucher amounts can lag behind market rates, especially in areas experiencing significant price increases. However, the U.S. Department of Housing and Urban Development (HUD) periodically adjusts voucher amounts to reflect changes in local market conditions. For ZIP 49232, where the median home value has increased by 8.0% over the past year, it's reasonable to anticipate that voucher amounts will also adjust to some degree, though they may not always reach the full market rent.
To conclude, while the data provides valuable insights into the ZIP 49232 real estate market, it's important to recognize that investing in any market involves risk. The FMR and median sales price indicate potential for profitability, but investors must also consider factors such as vacancy rates, maintenance costs, and market fluctuations.
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.