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)
A landlord considering ZIP code 50633 for Section 8 investments must follow a structured decision-making process. The first step involves assessing whether the Fair Market Rent (FMR) of $920 for the metro area in fiscal year 2026 can cover the debt service on a property valued at $164,857. Debt service typically includes mortgage payments, property taxes, insurance, and maintenance costs.
If the answer to the first question is yes, proceed to the second step. Evaluate if the current market rent of $531 per month, as reported by the Census ACS, is above, at, or below the FMR. In this case, since the market rent is below the FMR, it suggests that properties in this ZIP code are undervalued relative to what Section 8 tenants can afford, making it potentially attractive for investment.
The third step involves examining the rental demand. The data indicates that 37.7% of households are renters. However, the lack of data on days on market (DOM) makes it difficult to assess how quickly rental units are occupied. This uncertainty means that while there is a significant portion of renters, the speed at which you can lease out a unit remains unclear.
Decision Tree:
Does FMR cover debt service?
Yes: Proceed to the next question. FMR of $920 is sufficient to cover typical debt service costs, assuming reasonable rates and expenses.
No: Do not invest in this ZIP code. The FMR does not clear the debt service, indicating that Section 8 tenants cannot afford the rent required to sustain a profitable investment.
Is market rent above, at, or below FMR?
Below FMR: The market rent of $531 is below the FMR of $920, suggesting an opportunity where you can charge closer to the FMR and still attract tenants.
At or Above FMR: If the market rent were at or above the FMR, it would indicate a saturated market or higher competition, reducing the attractiveness of this ZIP code for Section 8 investments.
Are there enough renters and quick occupancy?
Yes: With 37.7% of households being renters and quick occupancy, there is a strong demand for rental properties. This scenario supports investment in Section 8 properties.
No: If the percentage of renters were lower or the days on market were high, it would indicate weak demand or difficulty in leasing units, which would discourage investment.
It Depends: Given the available data, the percentage of renters is substantial, but the lack of days on market data means that while demand exists, the speed of occupancy is uncertain. This uncertainty requires further investigation into local real estate trends and vacancy rates before making a final decision.
In conclusion, if the FMR covers debt service and the market rent is below the FMR, then the primary consideration becomes the strength and immediacy of rental demand. With a high percentage of renters but unknown days on market, the decision to invest in ZIP 50633 for Section 8 properties hinges on the ability to secure quick occupancy. Additional research into local vacancy rates and leasing times is recommended to make a fully informed decision.
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.