Location: Iowa City, IA | Metro: Iowa City, 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 | $1,060 |
| 1 Bedroom | $1,130 |
| 2 Bedrooms | $1,330 |
| 3 Bedrooms | $1,840 |
| 4 Bedrooms | $2,220 |
| 5 Bedrooms | $2,575 |
| 6 Bedrooms | $2,884 |
| 7 Bedrooms | $3,115 |
| 8 Bedrooms | $3,271 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,130 | $213,370 | 0.53% | F |
| 2BR | $1,330 | $234,806 | 0.57% | F |
| 3BR | $1,840 | $307,994 | 0.6% | F |
| 4BR | $2,220 | $387,668 | 0.57% | F |
| 5BR | $2,575 | $504,168 | 0.51% | F |
U.S. Census Bureau data (2024)
The Fair Market Rent (FMR) for ZIP code 52245 in Iowa City, IA, for fiscal year 2024 is set at $1200. This figure represents the payment standard for Section 8 housing vouchers, meaning the voucher will cover up to $1200 towards the monthly rent. It's important to note that this is not your actual rent; it's the maximum amount the voucher will pay.
To put this into perspective, the Zillow Observed Rental Index (ZORI) for the area is $1,577. This indicates that the average market rent is higher than the Section 8 payment standard. Therefore, landlords participating in the Section 8 program should expect to receive around $1200 per month, supplemented by the tenant paying the difference between the FMR and the market rent.
The demand for rental properties in ZIP 52245 is strong, with 40.4% of residents being renters. This high percentage suggests a significant portion of the population relies on rental housing, including those who might benefit from Section 8 vouchers. However, it also means competition among tenants can be fierce, which could affect vacancy rates and the time it takes to fill a property.
When acquiring a property for a Section 8 rental, the median home value in the area is approximately $322,805. This figure gives you an idea of the typical price range for homes in ZIP 52245, which can help you assess whether the potential income from a Section 8 tenant will justify the investment over time.
Before deciding to accept a Section 8 tenant, verify that your property meets the Housing Quality Standards (HQS). These standards ensure the rental unit is safe, decent, and sanitary. Failure to meet these criteria can result in penalties or loss of participation in the program.
In summary, the FMR of $1200 sets the payment limit for Section 8 vouchers, while the local market rent of $1,577 shows that you might need to adjust your expectations. With a strong 40.4% renter share, there is significant demand for rental properties. The median home value of $322,805 helps you gauge the investment. Ensure your property complies with HQS to avoid issues.
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.