Location: Wood County, WI | Metro: Adams County, WI
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 | $800 |
| 1 Bedroom | $850 |
| 2 Bedrooms | $1,110 |
| 3 Bedrooms | $1,410 |
| 4 Bedrooms | $1,480 |
| 5 Bedrooms | $1,717 |
| 6 Bedrooms | $1,923 |
| 7 Bedrooms | $2,077 |
| 8 Bedrooms | $2,181 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,110 | $170,875 | 0.65% | D |
| 3BR | $1,410 | $247,492 | 0.57% | F |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 54494, Wisconsin Rapids, WI, reveals some key insights into the potential returns for landlords and small-portfolio investors. The Fair Market Rent (FMR) for a 2-bedroom apartment in the metro area for fiscal year 2026 is set at $1,070 annually. This translates to a monthly rental income of approximately $89.17 under the Section 8 program. Using the median home value of $228,982, the implied gross yield for a property rented through Section 8 would be about 4.79%. This calculation is derived by multiplying the annualized FMR by 12 months and dividing it by the median home value.
In contrast, the market rent for a similar property, based on Zillow's Observed Rent Index (ZORI), stands at $1,028 annually. This equates to a monthly rental income of roughly $85.67 when rented at market rates. The implied gross yield for a property rented at market rates is slightly lower at 4.53%, calculated similarly by multiplying the annualized market rent by 12 and dividing by the median home value.
The difference between the two yields is marginal, with the Section 8 scenario offering a higher gross yield of 4.79% compared to the market rent scenario at 4.53%. However, the decision on whether to participate in the Section 8 program should also consider other factors such as the 22.3% renter density in the area, which suggests a moderate demand for rental properties. Additionally, the lack of data on days on market (DOM) makes it challenging to predict how quickly a property might be leased under either scenario. Given these considerations, while the gross yield is slightly better under Section 8, the market rent scenario could be more realistic due to the potentially higher stability and fewer administrative complexities associated with renting at market rates.
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.