Location: Jones County, IA | Metro: Jones County, IA HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $680 |
| 1 Bedroom | $770 |
| 2 Bedrooms | $970 |
| 3 Bedrooms | $1,270 |
| 4 Bedrooms | $1,270 |
| 5 Bedrooms | $1,473 |
| 6 Bedrooms | $1,650 |
| 7 Bedrooms | $1,782 |
| 8 Bedrooms | $1,871 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 52321 reveals a nuanced investment landscape. To begin, let's examine the Federal Market Rent (FMR) and market rent figures for a two-bedroom property. The annualized FMR for a 2BR in ZIP 52321 is $10,320 ($860 per month). In contrast, the market rent stands at $10,332 ($861 per month).
With a median home value of $220,961, we can calculate the implied gross yield for both scenarios. For the FMR scenario, the gross yield is approximately 4.7%. This is derived from dividing the annual FMR ($10,320) by the median home value ($220,961). On the other hand, using the market rent figure, the gross yield slightly improves to 4.7%.
The difference between these two yields is minimal, indicating that the investment potential is nearly identical whether relying on Section 8 vouchers or market rents. However, the reality of the rental market in ZIP 52321 must be considered. With a renter density of 19.9%, it suggests that the majority of residents prefer homeownership over renting, which could impact the demand for rental properties. Additionally, the lack of data on days on market (DOM) makes it challenging to assess how quickly properties might be leased, especially under the Section 8 program.
In conclusion, while both the FMR and market rent scenarios offer a gross yield around 4.7%, the actual performance may vary due to local rental market dynamics. Landlords and small-portfolio investors should weigh the benefits of steady income from Section 8 against the potentially lower demand for rental units in ZIP 52321.
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.