Location: Otsego County, MI | Metro: Montmorency 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 | $830 |
| 1 Bedroom | $940 |
| 2 Bedrooms | $1,110 |
| 3 Bedrooms | $1,460 |
| 4 Bedrooms | $1,570 |
| 5 Bedrooms | $1,821 |
| 6 Bedrooms | $2,040 |
| 7 Bedrooms | $2,203 |
| 8 Bedrooms | $2,313 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,460 | $269,259 | 0.54% | F |
U.S. Census Bureau data (2024)
The market analysis for Section 8 investors in ZIP code 49751, located in Otsego County, MI metro, reveals a favorable environment for cashflow generation. The HUD Fair Market Rent (FMR) for the area is set at $1,050 for fiscal year 2026, which is significantly higher than the average market rent of $813 based on Census ACS data. This means that voucher tenants will provide a strong positive cashflow at the FMR rate.
To further understand the investment potential, we can look at the median home value in the area, which stands at $221,100. Using this figure, we calculate the rent-to-price ratio by dividing the average market rent ($813) by the median home value ($221,100), resulting in a ratio of approximately 0.0037. This indicates that rental income represents a very small portion of the property's value, suggesting that the area is more suited for homeownership rather than renting. However, for Section 8 investors, the key metric is the difference between the FMR and the actual market rent, which is substantial at $237 per month.
The dynamics between renting and buying in this market are important to consider. With a median Days on Market (DOM) of N/A and a price-cut share of N/A%, it is evident that the local real estate market does not experience frequent price reductions or extended periods of unsold inventory. This stability supports the idea that properties in this area will retain their value over time.
In conclusion, the strongest investor angle in ZIP code 49751 is cashflow. The significant gap between the HUD FMR and the actual market rent ensures that even standard units will generate a positive cashflow, making this location an attractive option for Section 8 investors looking to maximize their monthly returns.
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.