Location: Sioux City, IA | Metro: Sioux City, IA-NE-SD MSA
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 | $900 |
| 1 Bedroom | $1,040 |
| 2 Bedrooms | $1,290 |
| 3 Bedrooms | $1,560 |
| 4 Bedrooms | $1,750 |
| 5 Bedrooms | $2,030 |
| 6 Bedrooms | $2,274 |
| 7 Bedrooms | $2,456 |
| 8 Bedrooms | $2,579 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,040 | $123,239 | 0.84% | C |
| 2BR | $1,290 | $178,894 | 0.72% | D |
| 3BR | $1,560 | $234,848 | 0.66% | D |
| 4BR | $1,750 | $275,600 | 0.63% | D |
| 5BR | $2,030 | $467,315 | 0.43% | F |
U.S. Census Bureau data (2024)
The median income in ZIP 51106, located in Sioux City, Iowa, stands at $78,434. This figure provides a benchmark for assessing the financial capacity of households to cover rental expenses. The market rate for renting, known as the Zillow Observed Rent Index (ZORI), is $1,308 per month. This amount represents the average rent paid by tenants in the area, indicating the current demand and pricing dynamics.
In contrast, the Fair Market Rent (FMR) for zip code 51106 in fiscal year 2024 is set at $1,040. This is the standard amount used for determining housing assistance payments under the Section 8 program. It means that for a household receiving a Section 8 voucher, the maximum rent they would pay out-of-pocket is significantly lower than the market rate.
The affordability gap between the median income and both the market rate and voucher standard is substantial. Households must spend a considerable portion of their income on market-rate rents, which could strain their budgets. Given that 29.8% of the 28,592 residents are renters, there is a notable segment of the population potentially facing challenges in affording market-rate rentals.
This situation has implications for landlords considering their rental strategies. Landlords who accept Section 8 vouchers will benefit from a guaranteed source of income, albeit at a lower rate than the market allows. However, they might experience reduced vacancy rates due to the high demand for affordable housing among renters.
On the other hand, landlords who focus on cash-paying tenants can command higher rents but must be prepared for increased competition and possibly longer vacancy periods if potential tenants cannot meet the financial demands of the market rate.
Takeaway: For landlords in ZIP 51106, accepting Section 8 vouchers can provide a stable income stream and attract a steady flow of tenants. However, those looking to maximize revenue should consider the local economic conditions and the ability of renters to afford market-rate prices, while being aware of the competitive landscape.
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.