Section 8 Fair Market Rent (FMR) for ZIP 49255 - 2027

Location: Hillsdale County, MI | Metro: Branch County, MI

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$920
1 Bedroom	$960
2 Bedrooms	$1,140
3 Bedrooms	$1,490
4 Bedrooms	$1,540
5 Bedrooms	$1,786
6 Bedrooms	$2,000
7 Bedrooms	$2,160
8 Bedrooms	$2,268

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

Population

2,072

Median Household Income

$51,346

Housing Units

837

Renter Percentage

11.7%

Occupancy Rate

73.4%

Renter Occupied

A landlord considering ZIP code 49255 for Section 8 investments must follow a structured decision-making process. Here's how to approach the question "Should I buy here for Section 8?" based on the data available.

Step 1: Determine if the Fair Market Rent (FMR) of $1,120 can cover the debt service on a property valued at $172,558. To calculate the debt service, use a typical mortgage rate. For example, at a 4% interest rate over 30 years, the monthly payment would be approximately $837. The FMR of $1,120 clearly exceeds this amount, indicating that a Section 8 tenant can cover the mortgage payments comfortably.

Step 2: Compare the market rent of $908 (from Census ACS data) with the FMR. In this case, the market rent is below the FMR, suggesting that Section 8 rates are competitive and potentially higher than what you might receive from non-subsidized tenants. This makes the area attractive for Section 8 investments.

Step 3: Assess the rental demand. With 11.7% of residents being renters, there is a moderate level of rental activity. However, the data does not provide days on the market (DOM), making it difficult to gauge the speed at which properties are rented out. Despite this lack of information, the percentage of renters indicates a stable demand for rental properties.

If the answer to Step 1 is yes: Proceed to Step 2. The FMR is sufficient to cover the debt service, so the next step is crucial.
If the answer to Step 2 is yes (market rent is below FMR): The rates for Section 8 tenants are favorable compared to the local market, supporting a positive investment decision.
If the answer to Step 3 is yes: There is enough demand among renters to support your investment. Although DOM data is missing, the presence of 11.7% renters suggests stability.
If the answer to Step 3 is no or it depends: The decision hinges on the missing DOM data. Without knowing how quickly units are rented, it's challenging to predict cash flow reliability. In this scenario, it depends on additional factors such as the landlord's risk tolerance and willingness to wait for a tenant.

In conclusion, if the landlord can secure a property valued at around $172,558, the FMR of $1,120 will comfortably cover the debt service. The fact that market rents are below the FMR adds another layer of attractiveness to the investment. However, the decision ultimately depends on the landlord's assessment of the rental demand, given the lack of DOM data. If the landlord is comfortable with the current data and believes the rental market will sustain their investment, then the answer is yes. Otherwise, it depends on further investigation into the local rental market dynamics.

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.