Location: Van Buren County, IA | Metro: Davis 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 | $750 |
| 1 Bedroom | $760 |
| 2 Bedrooms | $1,000 |
| 3 Bedrooms | $1,190 |
| 4 Bedrooms | $1,530 |
| 5 Bedrooms | $1,775 |
| 6 Bedrooms | $1,988 |
| 7 Bedrooms | $2,147 |
| 8 Bedrooms | $2,254 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,000 | $176,388 | 0.57% | F |
| 3BR | $1,190 | $267,864 | 0.44% | F |
U.S. Census Bureau data (2024)
A decision tree for evaluating whether to invest in ZIP code 52551 (Douds, IA) for Section 8 properties hinges on three key questions.
1) Does the Fair Market Rent (FMR) of $970 cover the debt service on a property valued at $230,556?
Yes: The FMR of $970 must be sufficient to cover the mortgage payments, taxes, insurance, and other costs associated with owning a $230,556 property. If the debt service is lower than the FMR, then this ZIP code is financially viable for Section 8 properties.
No: If the FMR of $970 does not cover the total debt service costs for a $230,556 property, investing here would lead to financial losses. This makes it an unsuitable location for Section 8 investments.
It Depends: If the FMR of $970 is close to but slightly below the debt service costs, it might still be viable if there are other income sources such as utility reimbursements or if the landlord is willing to accept a lower profit margin.
2) Is the market rent above, at, or below the FMR?
Above: If the market rent is higher than the FMR of $970, landlords can consider renting to non-Section 8 tenants to maximize income. However, this also means fewer potential Section 8 tenants who might find the rent too high.
At: When the market rent matches the FMR, it indicates that the area is well-aligned with the housing assistance program. Landlords can expect a steady stream of Section 8 tenants.
Below: If the market rent is below the FMR, landlords may face competition from private rentals. This could make it harder to attract Section 8 tenants unless they offer additional amenities or services.
3) Are the 23.2% of renters combined with the days on market (DOM) sufficient to meet demand?
Yes: With 23.2% of the population being renters and assuming a reasonable DOM, this suggests there is adequate demand for rental properties. Landlords can confidently pursue investment opportunities in Douds, IA.
No: If the DOM is excessively long, it indicates a low demand for rental properties despite the 23.2% renter rate. In this case, landlords should reconsider their investment plans as it may not be profitable.
It Depends: If the DOM is moderate and the percentage of renters is stable, landlords should conduct further analysis into local economic conditions, employment rates, and the availability of Section 8 vouchers to determine if the demand will support their investment.
The decision to invest in ZIP code 52551 ultimately depends on the answers to these questions and the landlord's tolerance for risk and profitability expectations.
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.