Location: Grand Rapids-Wyoming, MI | Metro: Grand Rapids-Wyoming, MI HUD Metro FMR Area
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 | $1,390 |
| 1 Bedroom | $1,450 |
| 2 Bedrooms | $1,730 |
| 3 Bedrooms | $2,240 |
| 4 Bedrooms | $2,570 |
| 5 Bedrooms | $2,981 |
| 6 Bedrooms | $3,339 |
| 7 Bedrooms | $3,606 |
| 8 Bedrooms | $3,786 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,730 | $271,153 | 0.64% | D |
| 3BR | $2,240 | $311,875 | 0.72% | D |
| 4BR | $2,570 | $352,552 | 0.73% | D |
U.S. Census Bureau data (2024)
The ZIP code 49505 is located in Grand Rapids, Michigan, and it encompasses a diverse residential area within the city. With a total population of 32,426, the neighborhood has a significant rental market, accounting for 34.3% of all housing units. The median household income in this area is $74,906, which suggests a middle-class community. The median home value stands at $301,171, reflecting a mix of modest and moderately priced homes.
Turning to the rent economics, the Fair Market Rent (FMR) for ZIP 49505 as of the fiscal year 2024 is set at $1,370. This figure contrasts with the actual market rent, known as ZORI (Zillow Observed Rent Index), which is $1,709. This difference indicates that there is a gap between government-subsidized rents and the market rates, providing an opportunity for landlords who can manage the nuances of Section 8 tenancy.
The disparity between the FMR and the ZORI suggests that this neighborhood might be better suited for hands-on value-add buyers rather than hands-off operators. Landlords who are willing to engage actively with their properties and tenants can leverage the higher market rents to improve the quality of their units and still remain competitive within the Section 8 program. For those looking to maintain a passive investment strategy, the lower FMR could pose challenges in covering the costs associated with property management and maintenance.
In conclusion, ZIP 49505 presents a balanced opportunity for investors willing to invest time and resources into improving their rental properties. The potential for higher returns through market rents makes it a compelling choice for those seeking to enhance their portfolio's value over time.
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.