Location: Milwaukee-Waukesha, WI | Metro: Milwaukee-Waukesha, WI MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,150 |
| 1 Bedroom | $1,230 |
| 2 Bedrooms | $1,470 |
| 3 Bedrooms | $1,810 |
| 4 Bedrooms | $1,940 |
| 5 Bedrooms | $2,250 |
| 6 Bedrooms | $2,520 |
| 7 Bedrooms | $2,722 |
| 8 Bedrooms | $2,858 |
The analysis of the Section 8 cap-rate picture for ZIP code 53187 in Unknown, Wisconsin, requires an understanding of the Fair Market Rent (FMR) and the median home value. For FY 2024, the annualized 2BR FMR stands at $1360. However, the market rent is currently not available, as well as the median home value, which complicates a precise cap-rate calculation.
In the scenario where we use the 2BR FMR, the implied gross yield can be derived by assuming the median home value is known. For instance, if the median home value were hypothetically $272,000 (twice the annual FMR), the gross yield would be 5%. This calculation is based on the assumption that the property value is directly tied to the rental income, which is not always the case in real estate markets.
Given the lack of specific market rent data, it's challenging to provide a concrete gross yield comparison. However, it's important to note that the FMR is typically lower than market rents, especially in areas with higher demand and limited supply. Therefore, using the FMR alone may understate the potential gross yield of properties in ZIP 53187.
The renter density and days on market (DOM) are also critical factors. With renter density at N/A%, it's difficult to assess the likelihood of finding tenants who qualify for Section 8. Similarly, the N/A-day DOM indicates uncertainty about how quickly properties might be leased, affecting cash flow projections.
While the FMR-based gross yield provides a baseline, it is less realistic without knowing the actual market rent. Investors should gather additional data on local rental rates and consider the broader economic context before making investment decisions in ZIP 53187.
To summarize, the implied gross yield based on the 2BR FMR would be 5%, assuming a median home value of $272,000. However, this figure is speculative due to the absence of specific market rent data. Realistically, the gross yield could be higher if market rents exceed the FMR, which is often the case in competitive rental markets.
Data Sources: FMR data from HUD (2027).
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.