Location: Chicago-Joliet-Naperville, IL | Metro: Chicago-Joliet-Naperville, IL HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,650 |
| 1 Bedroom | $1,750 |
| 2 Bedrooms | $1,980 |
| 3 Bedrooms | $2,550 |
| 4 Bedrooms | $2,910 |
| 5 Bedrooms | $3,376 |
| 6 Bedrooms | $3,781 |
| 7 Bedrooms | $4,083 |
| 8 Bedrooms | $4,287 |
To understand the economics of Section 8 in ZIP code 60204, it's essential to know the SAFMR (Small Area Fair Market Rent) for a two-bedroom apartment is set at $1680 for fiscal year 2024. This SAFMR is specifically tailored for this ZIP code, reflecting the unique housing market conditions here.
The SAFMR figure is the maximum amount that the Housing Choice Voucher program will pay toward the rent for a two-bedroom unit. However, the actual reimbursement to landlords depends on several factors, including the tenant's contribution and any utility allowances.
Tenants participating in the Section 8 program are required to contribute 30% of their adjusted income towards rent. If a tenant's monthly adjusted income is $1500, they would contribute $450 towards the rent. This amount is calculated by the local Public Housing Agency (PHA) based on the tenant's income documentation.
In addition to the tenant's contribution, landlords also receive a utility allowance. For ZIP 60204, the utility allowance for a two-bedroom apartment is $400 per month. This allowance is designed to cover the cost of utilities such as electricity, gas, water, and sewerage.
Therefore, if we take the SAFMR of $1680 and subtract the tenant's contribution of $450, and then add the utility allowance of $400, the total reimbursement to the landlord would be $1630. This calculation shows that the landlord would receive slightly less than the SAFMR, creating a small reimbursement gap of $50.
It's important to note that the reimbursement gap or surplus can vary depending on the tenant's income and the specific utility allowance for the unit. In ZIP 60204, the typical reimbursement gap for a two-bedroom apartment is around $50, meaning landlords receive $50 less than the SAFMR when the tenant's contribution and utility allowance are factored in.
Landlords should also consider that the SAFMR does not account for vacancy rates, which can affect the overall rental income. Additionally, maintaining a property that meets Section 8 standards can incur additional costs. Despite these considerations, many landlords find the program beneficial due to the consistent payment structure and the support of the PHA in managing the financial aspects of renting to low-income tenants.
Data Sources: FMR data from HUD (2027).
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.