Section 8 Fair Market Rent (FMR) for ZIP 58078 - 2027

Investment Score for ZIP 58078

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	$880
1 Bedroom	$1,010
2 Bedrooms	$1,240
3 Bedrooms	$1,720
4 Bedrooms	$2,070
5 Bedrooms	$2,401
6 Bedrooms	$2,689
7 Bedrooms	$2,904
8 Bedrooms	$3,049

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
3BR	$1,720	$308,893	0.56%	F
4BR	$2,070	$387,548	0.53%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 58078 (Bismarck, ND) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 58078 is set by HUD for the year 2026 and ranges from $860 for a zero-bedroom unit to $2080 for a four-bedroom unit. To understand how these figures compare to actual rents, we would typically look at Zillow data; however, there is no recent Zillow data available for this ZIP code. Given the lack of current rental price data, we can only infer that the FMRs are likely close to the actual market rents, especially considering Bismarck’s relatively stable housing market. HUD’s FMRs serve as a benchmark for determining the maximum rent that Section 8 voucher holders can pay. For instance, a voucher holder seeking a two-bedroom apartment cannot pay more than $1240 per month. This constraint can limit the number of units they can afford, particularly if the local rental market has higher rates for certain types of properties. #### Affordability & Renter Profile ZIP code 58078 has a population of 40,631, with 35.3% of residents being renters. The occupancy rate is quite high at 95.7%, indicating a tight rental market where most available units are occupied. The median household income in the area is $91,040, which means that the average renter spends approximately 16.3% of their income on a two-bedroom unit priced at $1240. This percentage suggests that while the cost of renting is manageable for many residents, it could still be a significant expense for those with lower incomes. Given the high occupancy rate and the substantial portion of the population that rents, it is likely that demand for rental units is strong. However, the tight market also implies that there might be limited supply, which could drive up rental prices and make it difficult for some voucher holders to find suitable housing. #### Investor Angle From an investor perspective, the key question is whether the FMRs allow for a cash-flow positive investment. Assuming that the FMRs are reflective of actual market rents, let's consider the potential returns: - A zero-bedroom unit at $860 per month. - A one-bedroom unit at $1020 per month. - A two-bedroom unit at $1240 per month. - A three-bedroom unit at $1720 per month. - A four-bedroom unit at $2080 per month. To determine if these rents cover the costs of ownership, including mortgage payments, property taxes, insurance, maintenance, and other expenses, we need to estimate the total monthly costs. For simplicity, let's assume the following average monthly costs based on typical metrics: - Zero-bedroom: $600 - One-bedroom: $750 - Two-bedroom: $900 - Three-bedroom: $1050 - Four-bedroom: $1200 Using these estimates, we can calculate the net cash flow for each type of unit: - Zero-bedroom: $860 - $600 = $260 - One-bedroom: $1020 - $750 = $270 - Two-bedroom: $1240 - $900 = $340 - Three-bedroom: $1720 - $1050 = $670 - Four-bedroom: $2080 - $1200 = $880 These calculations suggest that investing in rental properties in ZIP code 58078 could be profitable, especially for larger units. The net cash flows indicate that even with the constraints imposed by FMRs, investors can still achieve positive cash flow. #### Investment Grade The investment grade for this ZIP code would depend on various factors such as the stability of the local economy, the demand for rental units, and the overall risk profile. Given the high occupancy rate and the strong demand for rentals, the investment grade appears to be favorable. Additionally, the relatively high median income supports the likelihood of timely rent payments and lower default risks. #### Specific Actionable Insights 1. **Focus on Larger Units**: Investors should consider focusing on larger units, such as three-bedroom and four-bedroom apartments, which offer higher net cash flows. For example, a three-bedroom unit at $1720 per month yields a net cash flow of $670, while a four-bedroom unit at $2080 per month provides a net cash flow of $880. 2. **Understand Local Rental Market Trends**: Despite the lack of recent Zillow data, understanding local trends through other sources like real estate agents, local government reports, or community forums can provide valuable insights into the actual rental market dynamics. This will help in making informed decisions about pricing and occupancy. 3. **Consider Property Management Services**: Given the tight market and the potential complexity of managing Section 8 vouchers, hiring a professional property management service might be beneficial. They can handle tenant screening, lease enforcement, and maintenance, ensuring smoother operations and better compliance with HUD regulations. #### Bottom Line Based on the provided data, ZIP code 58078 presents a favorable opportunity for Section 8-focused investors. The high occupancy rate and strong demand for rentals suggest a robust market, while the FMRs allow for positive cash flows, especially for larger units. Therefore, the recommendation is to **Buy** in this ZIP code, with a particular focus on properties that can accommodate three-bedroom and four-bedroom units due to their higher profitability.

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.