Section 8 Fair Market Rent (FMR) for ZIP 53590 - 2027

Investment Score for ZIP 53590

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,240
1 Bedroom	$1,420
2 Bedrooms	$1,620
3 Bedrooms	$2,120
4 Bedrooms	$2,340
5 Bedrooms	$2,714
6 Bedrooms	$3,040
7 Bedrooms	$3,283
8 Bedrooms	$3,447

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,620	$315,094	0.51%	F
3BR	$2,120	$421,676	0.5%	F
4BR	$2,340	$525,813	0.45%	F
5BR	$2,714	$635,817	0.43%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 53590 (Sun Prairie, WI) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 53590, as determined by HUD for 2026, is set at $1710 for a two-bedroom unit. This represents 21.1% of the median household income of $97,051 in Sun Prairie. However, the actual rental market in Sun Prairie appears to be significantly higher than the FMR. For instance, the Zillow median price for a two-bedroom home is $303,405, which translates to a price-to-FMR ratio of 14.8x. This suggests that the actual rent prices in the area could be much higher than the FMR, creating a significant constraint for voucher holders who can only pay up to the FMR amount. As a result, voucher holders may struggle to find suitable housing options within their budget, especially for larger units where the gap between FMR and market rent is even wider. #### Affordability & Renter Profile Sun Prairie has a relatively high occupancy rate of 98.1%, indicating a strong demand for housing. With 34.1% of the population being renters, there is a substantial segment of the community that relies on rental properties. The median household income of $97,051 suggests that many residents have the financial capability to afford higher rents, but those relying solely on Section 8 vouchers would find it challenging to secure housing. Given the high occupancy rate and the significant portion of the population that rents, it is clear that the market is tight, with limited availability of affordable units. This tightness is further exacerbated by the disparity between FMR and market rents, making it difficult for low-income renters to find suitable housing without additional support. #### Investor Angle From an investor perspective, the ZIP code 53590 presents a mixed picture when considering cash flow and investment grade. While the median household income is relatively high, the actual rents in the market far exceed the FMR, which means that properties rented to Section 8 voucher holders will likely generate lower cash flows compared to market rents. For example, a two-bedroom unit renting at the FMR of $1710 would be significantly below the market rent, which is implied to be around $303,405 based on the Zillow median price. This makes the investment less attractive from a purely financial standpoint, as the returns would be lower due to the capped rent levels. However, the high occupancy rate and strong demand for rental properties indicate that there is a stable tenant base, which can provide some security for investors. Additionally, the high percentage of renters suggests that there is a consistent need for rental housing, which can help maintain a steady stream of tenants. Despite these positives, the significant gap between FMR and market rents means that the investment grade for Section 8-focused properties is lower compared to those rented at market rates. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should consider focusing on smaller units such as one-bedroom or studio apartments. The FMR for a one-bedroom unit is $1500, which is still below the market rent but offers a better chance of finding tenants willing to accept the lower rent. This strategy can help mitigate the risk of vacancy and ensure a more stable cash flow. 2. **Consider Mixed-Income Developments**: To balance the financial risks associated with Section 8 properties, investors might want to explore mixed-income developments. By combining a few Section 8 units with market-rate units, the overall financial performance of the property can be improved. This approach leverages the strong demand for rental housing while providing affordable options for low-income families. 3. **Engage with Local Housing Authorities**: Building relationships with local housing authorities can provide valuable insights into the demand for Section 8 vouchers and potential opportunities for securing tenants. These authorities often have waiting lists and can help connect investors with eligible households, reducing the time to lease up Section 8 units. #### Bottom Line Given the high price-to-FMR ratio and the tight rental market in Sun Prairie, the recommendation for Section 8-focused investors is to **Skip** this ZIP code unless they can find ways to mitigate the financial risks through strategies like mixed-income developments or focusing on smaller units. The significant gap between FMR and market rents makes it challenging to achieve positive cash flow, and the limited availability of affordable units could lead to prolonged vacancies. Therefore, investors looking to maximize returns and minimize risks should consider other markets with a closer alignment between FMR and actual rents.

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.