Section 8 Fair Market Rent (FMR) for ZIP 50023 - 2027

Investment Score for ZIP 50023

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,180
1 Bedroom	$1,230
2 Bedrooms	$1,460
3 Bedrooms	$1,990
4 Bedrooms	$2,040
5 Bedrooms	$2,366
6 Bedrooms	$2,650
7 Bedrooms	$2,862
8 Bedrooms	$3,005

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,460	$212,447	0.69%	D
3BR	$1,990	$323,648	0.61%	D
4BR	$2,040	$414,495	0.49%	F
5BR	$2,366	$522,149	0.45%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 50023 (Ankeny, IA) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 50023 is set by HUD for 2026, with the following rates for different unit types: - 0BR: $1160 - 1BR: $1210 - 2BR: $1440 (which is 14.7% of the median household income) - 3BR: $1960 - 4BR: $2010 To understand how these FMRs compare to actual rents, we can look at the Zillow median price for a 2BR property, which stands at $211,840. This gives us a price-to-FMR ratio of 12.3x for a 2BR unit. This high ratio suggests that the actual rental prices in Ankeny are significantly higher than the FMRs set by HUD. For voucher holders, this means they face significant constraints. The maximum rent allowed under a Section 8 voucher for a 2BR unit is $1440 per month, which is much lower than what might be available on the open market. This could limit their choices and potentially force them into less desirable areas or units that do not meet their needs. #### Affordability & Renter Profile Ankeny has a population of 46,306, with 28.5% of residents being renters. The median household income is $117,826, indicating a relatively affluent community. Given that the FMR for a 2BR unit is only 14.7% of the median income, it appears that most residents can afford market-rate housing without assistance. However, the high price-to-FMR ratio indicates that the rental market is tight and likely favors landlords over tenants. The occupancy rate of 95.5% suggests that there is a strong demand for housing in Ankeny, which further supports the notion that the rental market is competitive. With limited availability and high prices, the market is likely to be challenging for low-income renters who rely on Section 8 vouchers. #### Investor Angle From an investor perspective, the ZIP code 50023 offers some interesting dynamics. The FMRs set by HUD provide a baseline for rental pricing, but the actual market rates are considerably higher. For example, the Zillow median price for a 2BR unit is $211,840, which translates to a monthly mortgage payment of approximately $1000 based on a 4.5% interest rate and a 30-year fixed mortgage. Adding property taxes, insurance, and maintenance costs, the total monthly expenses would likely exceed $1440, making it difficult to achieve positive cash flow solely on the basis of FMRs. However, if an investor is willing to accept a lower rent initially and then increase it once the tenant vacates, there is potential for long-term profitability. The high median income and strong demand for housing suggest that there is a solid foundation for rental investments, even if they cannot immediately generate positive cash flow at FMR levels. In terms of investment grade, Ankeny’s stable economy and high occupancy rates indicate a low-risk environment. The challenge lies in finding properties that can be rented out at FMR levels while still covering all expenses and providing a reasonable return on investment. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, smaller units like 0BR and 1BR might be more feasible for achieving positive cash flow. These units have FMRs of $1160 and $1210 respectively, which are closer to the actual mortgage payments and other expenses. 2. **Consider Short-Term Rentals**: If you are looking to maximize returns, consider converting properties into short-term rentals through platforms like Airbnb. This can help offset the lower rents paid by Section 8 voucher holders during periods when the property is vacant. 3. **Target Underserved Areas**: Within Ankeny, there may be pockets where rental prices are closer to FMRs. Targeting these areas could provide better opportunities for positive cash flow while still serving the needs of low-income renters. #### Bottom Line For Section 8-focused investors, the ZIP code 50023 presents a mixed picture. While the overall market is strong and demand is high, the high price-to-FMR ratio makes it challenging to achieve immediate positive cash flow. Therefore, the recommendation is to **Hold** unless you can find properties in underserved areas or smaller units that are more aligned with FMRs. Investors should also consider diversifying their portfolio to include short-term rentals or other income streams to balance the financial impact of renting at FMR levels.

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.