Section 8 Fair Market Rent (FMR) for ZIP 55717 - 2027

FY 2027 Fair Market Rent Rates

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

A decision tree for evaluating whether to purchase properties in ZIP code 55717 for Section 8 investment hinges on three primary factors: Fair Market Rent (FMR), market rent comparison, and rental demand. Let's break down each step.

1. Does FMR $1520 (zip FY 2024) clear debt service on a $250,238 property?

• Yes: If the FMR of $1520 can cover the debt service, which includes mortgage payments, property taxes, insurance, and maintenance costs, then the investment is viable. Calculate your total annual debt service and divide by 12; if the result is less than $1520, you're in good shape.
• No: If the FMR cannot cover the debt service, purchasing in this area is not advisable for a Section 8 portfolio. Ensure that the $1520 FMR exceeds your monthly debt obligations.

2. Is market rent N/A (N/A) above, at, or below FMR?

• Market Rent Above FMR: If the market rent is higher than the FMR, there's an opportunity to maximize profits by renting to non-Section 8 tenants. However, this also means fewer potential Section 8 tenants due to the higher rent.
• Market Rent At FMR: If market rent matches the FMR, it's a balanced scenario where Section 8 tenants can afford the rent, but there's little room for profit increase unless you manage to reduce expenses.
• Market Rent Below FMR: If the market rent is below the FMR, it indicates a potentially strong demand for housing in this price range. Landlords can set their rents closer to the FMR without deterring tenants, maximizing income from both Section 8 and non-Section 8 sources.

3. Are 7.8% renters + N/A-day DOM enough demand?

• It Depends: The percentage of renters at 7.8% suggests a moderate level of demand. However, the Days on Market (DOM) being N/A means we lack critical information about how quickly properties are rented out. To make a final decision, you must ascertain the DOM. If DOM is low, it signals high demand; if high, it may indicate challenges in finding tenants.

Summarizing, if the FMR of $1520 covers the debt service and the market rent is either at or below FMR, the investment is likely worthwhile. However, the demand scenario requires additional investigation into the DOM to fully assess viability. Always cross-reference these points with local economic conditions and trends.

Data Sources: FMR data from HUD (2027). 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.