Location: Waterloo-Cedar Falls, IA | Metro: Waterloo-Cedar Falls, IA HUD Metro FMR Area
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 | $800 |
| 1 Bedroom | $880 |
| 2 Bedrooms | $1,150 |
| 3 Bedrooms | $1,470 |
| 4 Bedrooms | $1,920 |
| 5 Bedrooms | $2,227 |
| 6 Bedrooms | $2,494 |
| 7 Bedrooms | $2,694 |
| 8 Bedrooms | $2,829 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,150 | $200,837 | 0.57% | F |
| 3BR | $1,470 | $261,143 | 0.56% | F |
| 4BR | $1,920 | $356,247 | 0.54% | F |
U.S. Census Bureau data (2024)
In ZIP code 50643, which encompasses Hudson, Iowa, in Black Hawk County, the economics of Section 8 housing can be clearly understood by examining the SAFMR (Small Area Fair Market Rent) and comparing it to the local market rent. For fiscal year 2024, the SAFMR for a two-bedroom apartment in this ZIP code is set at $1070. This figure represents the maximum amount that a landlord can receive from the Section 8 program for a two-bedroom unit, specifically tailored to the rental conditions in ZIP 50643.
The local market rent, according to Census ACS data, stands at $953 for a two-bedroom apartment. This lower figure indicates that the SAFMR exceeds the average market rent in the area, potentially providing landlords with a more stable income source compared to fluctuating market rates.
A Section 8 voucher pays a significant portion of the rent directly to the landlord, but there are components that must be considered to understand the total reimbursement. The tenant is responsible for paying 30% of their adjusted monthly income towards rent. Additionally, utility allowances are factored into the overall payment structure, which varies based on the household's needs and the cost of utilities in the area.
To illustrate, if a tenant has an adjusted monthly income of $1500, they would pay 30% of that, or $450, toward the rent. The remaining amount would be covered by the Section 8 program, up to the SAFMR limit. In this case, the landlord would receive the difference between the SAFMR ($1070) and the tenant's contribution ($450), totaling $620 from the program. If the actual market rent is below the SAFMR, the landlord will still receive the full market rent plus any applicable utility allowances, ensuring a consistent income stream.
The typical reimbursement gap or surplus for a two-bedroom apartment in ZIP 50643, given these parameters, results in a surplus. With the SAFMR at $1070 and the local market rent at $953, landlords participating in the Section 8 program for a two-bedroom unit can expect a surplus of $117 per month, assuming the market rent remains constant. This surplus is before considering utility allowances, which can further increase the net income received by the landlord.
This economic analysis shows that landlords in ZIP 50643 can benefit from the Section 8 program due to the higher SAFMR compared to the local market rent. It provides a reliable and often above-market-rate income for units that qualify under the program's guidelines.
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.