Section 8 Fair Market Rent (FMR) for ZIP 60626 - 2027

Investment Score for ZIP 60626

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	$1,900
1 Bedroom	$2,020
2 Bedrooms	$2,280
3 Bedrooms	$2,930
4 Bedrooms	$3,350
5 Bedrooms	$3,886
6 Bedrooms	$4,352
7 Bedrooms	$4,700
8 Bedrooms	$4,935

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$2,020	$176,500	1.14%	B
2BR	$2,280	$262,716	0.87%	C
3BR	$2,930	$400,504	0.73%	D
4BR	$3,350	$667,709	0.5%	F
5BR	$3,886	$864,409	0.45%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 60626 (Chicago, IL) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 60626 in Chicago, IL, is set by HUD for 2026 as follows: - 0BR: $1660 - 1BR: $1780 - 2BR: $2000 - 3BR: $2580 - 4BR: $2980 To understand how these figures compare to actual rents, we need to consider that the FMR represents the maximum amount that a Section 8 voucher holder can pay towards rent. In ZIP 60626, the 2BR FMR of $2000 is 40.2% of the median household income of $59,713. This indicates that the FMR is reasonably aligned with the income levels of residents, but it also suggests that many voucher holders will find it challenging to cover the remaining 59.8% of their income for other living expenses. The primary constraint for voucher holders is the limited budget they have available to pay rent. For instance, a voucher holder with a 2BR unit would be paying $2000 per month, which leaves them with only $3971 ($59,713 - $2000 * 12) annually for other expenses. This could be particularly challenging given the high cost of living in Chicago. #### Affordability & Renter Profile ZIP 60626 has a population of 49,662, with 72.7% of households being renters. The occupancy rate is 90.3%, indicating a relatively tight rental market where most units are occupied. Given the high percentage of renters, there is likely significant demand for affordable housing options. The median household income of $59,713 suggests that many residents are middle-income earners. However, the high renter percentage and the fact that 2BR units are priced at $248,600 on Zillow indicate that the area is quite expensive. The price-to-FMR ratio of 10.4x for 2BR units further underscores this point, as it shows that the median home value is significantly higher than what the average renter can afford through a Section 8 voucher. Given the high renter percentage and the tight occupancy rate, the market is likely undersupplied with affordable units, especially those that fit within the FMR guidelines. This means that many residents may struggle to find suitable housing, leading to potential competition among voucher holders for the limited number of affordable units. #### Investor Angle From an investor perspective, the key question is whether properties can generate positive cash flow at the FMR rates. To assess this, we must consider the typical costs associated with owning and managing rental properties, including mortgage payments, property taxes, insurance, maintenance, and vacancy rates. Assuming a 2BR unit is rented at the FMR of $2000 per month, the annual rent would be $24,000. With a median home value of $248,600, the typical monthly mortgage payment (assuming a 30-year fixed-rate mortgage at 5%) would be around $1240. Property taxes in Cook County average about 1.3%, so the annual tax bill would be approximately $3230, or $269 per month. Insurance costs vary but can be estimated at $100 per month. Maintenance and other operational costs might add another $100-$200 per month. Thus, the total monthly expenses for a 2BR unit might look like this: - Mortgage: $1240 - Taxes: $269 - Insurance: $100 - Maintenance: $150 - Vacancy Rate: $100 (assuming a conservative 5% vacancy rate) Total Monthly Expenses: $1859 With a monthly rent of $2000, the net cash flow would be approximately $141 per month, or $1692 annually. This is a modest positive cash flow, but it needs to be evaluated against the overall investment risk and returns. The investment grade for this ZIP code would be considered moderate. While there is a positive cash flow, the high renter percentage and tight occupancy rate suggest strong demand, but the high price-to-FMR ratio indicates that the market is not entirely aligned with the affordability goals of Section 8 vouchers. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, smaller units (0BR and 1BR) may offer better opportunities for positive cash flow. The FMR for a 1BR unit is $1780, while the median home value for such units is likely lower than that of 2BR units. Investors should consider acquiring properties with multiple small units to maximize their returns. 2. **Target Affordable Housing Areas**: Within ZIP 60626, there may be pockets where housing is more affordable relative to the FMR. Investors should conduct thorough neighborhood analysis to identify areas where the median home values are closer to the FMR. This could involve looking at specific streets or blocks within the ZIP code. 3. **Consider Mixed-Income Developments**: Given the high median home value and the high renter percentage, mixed-income developments that combine Section 8 units with market-rate rentals could provide a balanced approach. This strategy allows investors to leverage the demand for affordable housing while also capturing higher rents from non-voucher tenants. #### Bottom Line For Section 8-focused investors, ZIP 60626 presents a moderately attractive market. The positive cash flow, albeit modest, combined with the strong demand for affordable housing makes it a viable option. However, the high price-to-FMR ratio and the challenges faced by voucher holders in covering other living expenses suggest that the market is not perfectly aligned with the goals of providing truly affordable housing. **Recommendation**: **Buy** with caution. Focus on smaller units and consider mixed-income developments to balance the financial risks and rewards.

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.