Location: Chicago-Joliet-Naperville, IL | Metro: Chicago-Joliet-Naperville, IL HUD Metro FMR Area
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 | $1,920 |
| 1 Bedroom | $2,040 |
| 2 Bedrooms | $2,300 |
| 3 Bedrooms | $2,960 |
| 4 Bedrooms | $3,380 |
| 5 Bedrooms | $3,921 |
| 6 Bedrooms | $4,392 |
| 7 Bedrooms | $4,743 |
| 8 Bedrooms | $4,980 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $2,040 | $216,639 | 0.94% | C |
| 2BR | $2,300 | $248,609 | 0.93% | C |
| 3BR | $2,960 | $473,744 | 0.62% | D |
| 4BR | $3,380 | $632,041 | 0.53% | F |
| 5BR | $3,921 | $811,278 | 0.48% | F |
U.S. Census Bureau data (2024)
A skeptical investor might question whether the Fair Market Rent (FMR) of $2,020 for ZIP 60516 in fiscal year 2024 will sufficiently cover the mortgage on a $492,029 home. The answer is not straightforward because it depends on several factors, including the interest rate and loan terms. However, assuming a conservative fixed-rate mortgage of 4.5% over 30 years, the monthly mortgage payment would be approximately $2,497. This amount exceeds the FMR, indicating that additional sources of income or a lower-cost property may be necessary.
The investor could also argue that the 21.1% renter demand in Downers Grove, IL, might not be robust enough to sustain a rental business. While 21.1% is below the national average, it does suggest a significant portion of the population is interested in renting. According to data from RentData.org, Downers Grove has a diverse range of rental properties available, which indicates a steady demand for housing. However, this percentage alone does not provide a complete picture of the rental market's health, and further analysis of vacancy rates and tenant turnover would be needed to fully assess the situation.
A final concern is whether voucher utilization will keep pace with the $2,067 market rents. The data provided does not offer specific insights into voucher utilization rates for ZIP 60516. However, the FMR of $2,020 is close to the market rent, suggesting that voucher holders may find it challenging to afford market-rate rentals without additional financial support. Landlords should consider the potential for higher vacancy rates if they rely solely on voucher recipients to fill their units. It's important to note that while vouchers can help subsidize rent, they do not always cover the full market price.
In summary, while the FMR in ZIP 60516 is a useful benchmark, it may not fully cover the mortgage on a $492,029 home. The 21.1% renter demand suggests a moderate level of interest in renting, but more detailed market analysis is recommended. Lastly, voucher utilization rates are uncertain, and landlords should prepare for potential challenges in covering market rents exclusively through 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.