Location: Franklin County, IA | Metro: Franklin County, IA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $690 |
| 1 Bedroom | $710 |
| 2 Bedrooms | $930 |
| 3 Bedrooms | $1,140 |
| 4 Bedrooms | $1,550 |
| 5 Bedrooms | $1,798 |
| 6 Bedrooms | $2,014 |
| 7 Bedrooms | $2,175 |
| 8 Bedrooms | $2,284 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 50441 in Hampton, Iowa, reveals some interesting insights into potential investment returns. To begin with, the Fair Market Rent (FMR) for a two-bedroom unit in the metro area is set at $920 annually for fiscal year 2026. This translates to an implied gross yield of approximately 6.5%. The calculation is straightforward: $920 divided by the median home value of $140,603 equals 0.0065 or 6.5%.
On the other hand, the market rent based on the Census ACS data stands at $621 annually. When annualized against the median home value, this yields an implied gross yield of roughly 4.4%. The computation here is $621 divided by $140,603, resulting in 0.0044 or 4.4%.
Given the 28.4% renter density in Hampton, the market rent scenario appears more realistic. A higher proportion of renters suggests a greater likelihood of finding tenants willing to pay market rates, rather than relying solely on Section 8 vouchers. The lack of data on days on market (DOM) makes it difficult to assess how quickly properties can be leased, but the renter density provides a strong indicator of demand.
In conclusion, while the Section 8 FMR offers a higher gross yield of 6.5%, the market rent scenario, with its yield of 4.4%, seems more practical considering the local rental market conditions. Investors should weigh these figures carefully when making decisions about property investments in ZIP 50441.
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.