Location: Union County, IA | Metro: Adams County, IA
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 | $820 |
| 1 Bedroom | $850 |
| 2 Bedrooms | $1,110 |
| 3 Bedrooms | $1,440 |
| 4 Bedrooms | $1,540 |
| 5 Bedrooms | $1,786 |
| 6 Bedrooms | $2,000 |
| 7 Bedrooms | $2,160 |
| 8 Bedrooms | $2,268 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,110 | $117,556 | 0.94% | C |
| 3BR | $1,440 | $180,730 | 0.8% | D |
| 4BR | $1,540 | $205,017 | 0.75% | D |
U.S. Census Bureau data (2024)
The potential pitfalls for investing in ZIP code 50851 in Iowa through the Section 8 program are significant and must be carefully considered. Tenant turnover is a primary concern, with the market rent at $1,054 being notably higher than the Fair Market Rent (FMR) of $980. This discrepancy can lead to frequent changes in occupancy, as tenants may struggle to afford the market rates when their vouchers only cover up to the FMR.
Vacancy exposure is another issue. The average days on market (DOM) for rental properties in this area is not available, which makes it difficult to predict how long a property might remain vacant between tenancies. This uncertainty can be costly for landlords who rely on steady rental income.
Deferred maintenance is also a risk factor. With a typical home value of $151,681 and a median income of $70,926, many residents may find it challenging to keep up with necessary repairs and upgrades. This could translate into higher maintenance costs for landlords, especially if they are not prepared to invest in regular upkeep.
However, these risks are somewhat offset by the high renter share in the area, which stands at 21.5%. A larger percentage of renters often indicates a higher demand for housing vouchers, potentially leading to a stable stream of Section 8 tenants. Despite the challenges, the concentration of renters suggests that there will likely be a consistent pool of voucher holders looking for accommodation.
Verdict: Moderate risk for a first-time Section 8 landlord.
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.