Location: Milwaukee-Waukesha, WI | Metro: Milwaukee-Waukesha, WI 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 | $930 |
| 1 Bedroom | $1,010 |
| 2 Bedrooms | $1,210 |
| 3 Bedrooms | $1,490 |
| 4 Bedrooms | $1,610 |
| 5 Bedrooms | $1,868 |
| 6 Bedrooms | $2,092 |
| 7 Bedrooms | $2,259 |
| 8 Bedrooms | $2,372 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,210 | $312,560 | 0.39% | F |
| 3BR | $1,490 | $309,754 | 0.48% | F |
| 4BR | $1,610 | $319,606 | 0.5% | F |
U.S. Census Bureau data (2024)
The market analysis for Section 8 investors in ZIP code 53235, located in Saint Francis, WI, within Milwaukee County and part of the Milwaukee-Waukesha, WI MSA metro, reveals a significant gap between the Fair Market Rent (FMR) set by HUD and the actual market rents. For fiscal year 2024, HUD has established the FMR at $990 for this zip code. In contrast, the Zillow Observed Rental Index (ZORI) indicates that the average market rent is $1,721. This substantial difference means that landlords accepting Section 8 vouchers will experience negative cash flow when renting at the FMR rate.
To derive the rent-to-price ratio, we use the median home value of $282,344. The annual rent based on the FMR would be $11,880 ($990 per month), while the market rent would amount to $20,652 ($1,721 per month). Therefore, the rent-to-price ratio at the FMR is approximately 4.2%, whereas the market rent-to-price ratio is around 7.3%. These ratios suggest that properties rented at the FMR are undervalued relative to their market rental potential.
The negative cash flow scenario implies that landlords must either offer premium units with higher rental values or seek other strategies to offset the financial shortfall. Given the high market rents, landlords might consider upgrading units to command a higher rental rate, thereby improving cash flow. Alternatively, they could look into areas where the FMR is closer to the market rates to minimize losses.
Regarding the days on market (DOM) and price-cutting percentages, both metrics are not applicable (N/A) for the rental market. However, these figures are relevant for the buy-versus-rent dynamics. With the median home value at $282,344, the stability of property values and the low risk of needing to cut prices indicate a relatively stable housing market. This stability can provide a reliable investment environment for small-portfolio investors.
The strongest angle for Section 8 investors in ZIP 53235 is likely stability. Despite the negative cash flow at FMR, the low volatility in property values and the absence of typical seller concessions suggest a secure investment. Landlords should focus on long-term strategies that leverage this stability, such as property improvements to attract non-voucher tenants willing to pay market rates, or consider diversifying their portfolio across multiple zip codes with varying FMRs.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.