Location: Webster County, IA | Metro: Boone County, IA HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $710 |
| 1 Bedroom | $710 |
| 2 Bedrooms | $930 |
| 3 Bedrooms | $1,290 |
| 4 Bedrooms | $1,440 |
| 5 Bedrooms | $1,670 |
| 6 Bedrooms | $1,870 |
| 7 Bedrooms | $2,020 |
| 8 Bedrooms | $2,121 |
U.S. Census Bureau data (2024)
The Section 8 thesis in ZIP 50217 revolves around the disparity between the Fair Market Rent (FMR) set at $900 for fiscal year 2024 and the actual market rent of $726 as reported by the Census ACS. This gap stands at $174, representing a 23.9% difference between the two figures.
In ZIP 50217, where the median home value is $197,523 and the median income is $66,771, the FMR exceeds the market rent. This scenario makes voucher tenants a valuable asset for landlords and small-portfolio investors seeking higher yields. Voucher recipients pay a portion of their income towards rent, while the federal government covers the remainder up to the FMR limit. In this case, landlords can receive $900 per month from the government, which is significantly above the local market rate of $726. This differential directly translates into a better cash flow and higher rental yields for properties accepting Section 8 vouchers.
Given that 21.1% of residents are renters, there is a notable segment of the population that could benefit from subsidized housing. The higher FMR relative to market rent ensures that landlords are compensated at a level that surpasses what they would typically earn from open-market tenants. This makes the acceptance of Section 8 vouchers a strategic decision for maximizing returns on investment in ZIP 50217.
However, it is important to note that the cost of maintaining properties for voucher tenants must be factored into the equation. Landlords should ensure that their properties meet the necessary quality standards set by the Department of Housing and Urban Development (HUD) to avoid penalties and maintain eligibility for the program. Additionally, the management of Section 8 tenants might require additional administrative effort, but the financial benefits clearly outweigh these considerations given the favorable FMR to market rent ratio.
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.