Location: Ravalli County, MT | Metro: Ravalli County, MT
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 | $1,070 |
| 1 Bedroom | $1,140 |
| 2 Bedrooms | $1,400 |
| 3 Bedrooms | $1,940 |
| 4 Bedrooms | $2,340 |
| 5 Bedrooms | $2,714 |
| 6 Bedrooms | $3,040 |
| 7 Bedrooms | $3,283 |
| 8 Bedrooms | $3,447 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,140 | $386,152 | 0.3% | F |
| 2BR | $1,400 | $406,245 | 0.34% | F |
| 3BR | $1,940 | $565,596 | 0.34% | F |
| 4BR | $2,340 | $716,790 | 0.33% | F |
| 5BR | $2,714 | $966,158 | 0.28% | F |
U.S. Census Bureau data (2024)
The analysis of the Section 8 program in ZIP code 59840, which encompasses Hamilton, MT, reveals a significant opportunity for landlords and small-portfolio investors due to the gap between the Fair Market Rent (FMR) and the market rent. The FMR for the metro area for fiscal year 2026 is set at $1,410, while the actual market rent, as measured by ZORI, stands at $1,375. This creates a positive gap of $35, or approximately 2.4%, favoring voucher tenants.
Given that FMR exceeds the market rent, voucher tenants become an attractive option for yield-focused investments. Landlords can secure rental income at a rate slightly above the prevailing market conditions without the risk of vacancy. This is particularly advantageous in Hamilton, MT, where 29.7% of residents are renters and the median income is $61,752, indicating a segment of the population that relies heavily on affordable housing options.
The median home value in Hamilton, MT, is $529,957, reflecting a broader real estate market that may be out of reach for many local renters. By participating in the Section 8 program, landlords can tap into a stable source of income that is guaranteed by the federal government, thus mitigating financial risks associated with traditional rental properties. The slight premium of $35 over the market rent ensures a better yield compared to non-voucher tenants who might pay closer to the ZORI rate.
However, it's important to note that the higher FMR does not necessarily translate to higher net income for landlords. There are administrative costs, potential delays in payment, and the requirement to meet certain housing quality standards that come with accepting Section 8 vouchers. These factors must be weighed against the benefits of a steady stream of government-backed rental income.
In summary, the gap between FMR and market rent in Hamilton, MT, makes the Section 8 program a viable strategy for increasing yields in a rental market where 29.7% of the population are renters and median incomes are relatively low. Landlords should consider these opportunities carefully, understanding both the advantages and the responsibilities that come with accepting housing vouchers.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.