Section 8 Fair Market Rent (FMR) for ZIP 60637 - 2027

Investment Score for ZIP 60637

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	$1,450
1 Bedroom	$1,540
2 Bedrooms	$1,740
3 Bedrooms	$2,240
4 Bedrooms	$2,560
5 Bedrooms	$2,970
6 Bedrooms	$3,326
7 Bedrooms	$3,592
8 Bedrooms	$3,772

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	$1,540	$169,288	0.91%	C
2BR	$1,740	$203,667	0.85%	C
3BR	$2,240	$263,941	0.85%	C
4BR	$2,560	$351,382	0.73%	D
5BR	$2,970	$598,950	0.5%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 60637 (Chicago, IL) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) figures for ZIP code 60637 in Chicago, Illinois, provide insight into the rental market dynamics for low-income households who rely on Section 8 vouchers. The FMRs for 2026 are as follows: - 0BR: $1270 - 1BR: $1360 - 2BR: $1530 - 3BR: $1970 - 4BR: $2280 These FMRs represent the maximum rent that a voucher holder can pay, which is based on the local housing market conditions. However, the actual rents in the area are significantly higher. For instance, the Zillow median price for a 2BR property is $190,560, which translates to a monthly mortgage payment of approximately $1,000 assuming a 4.5% interest rate and a 30-year fixed mortgage. When combined with other costs such as property taxes, insurance, and maintenance, the total monthly cost for a landlord would likely exceed the FMR of $1530 for a 2BR unit. This means that voucher holders face significant constraints in finding affordable housing within the ZIP code. #### Affordability & Renter Profile ZIP code 60637 has a population of 52,721, with 74.0% of residents being renters. The occupancy rate stands at 85.5%, indicating a relatively tight rental market. Given the median household income of $43,609, the affordability of housing is a critical issue. The FMR for a 2BR unit is $1530, which represents 42.1% of the median income. This suggests that even at the FMR level, housing is still a substantial portion of the average renter’s budget. The high percentage of renters and the tight market indicate that there is strong demand for rental properties in this ZIP code. However, the limited supply of units that meet the FMR criteria means that many residents may struggle to find affordable housing. This situation is exacerbated by the fact that the price-to-FMR ratio is 10.4x, meaning that the median home value is over ten times the FMR for a 2BR unit. This implies that the rental market is highly competitive and that landlords have considerable leverage in setting rent prices. #### Investor Angle From an investor perspective, the ZIP code 60637 presents both opportunities and challenges. The FMRs provide a baseline for what voucher holders can afford, but they do not necessarily reflect the actual rents charged in the market. The Zillow median price for a 2BR property is $190,560, which, when converted to a monthly mortgage payment, would be around $1,000. Adding other expenses like property taxes (estimated at $3,000 annually), insurance ($1,200 annually), and maintenance ($1,000 annually), the total monthly cost for a landlord could be around $1,300. This is close to the FMR for a 2BR unit, but it leaves little room for profit margins. Given the high price-to-FMR ratio, the investment grade for this ZIP code is moderate. While there is strong demand for rental properties, the limited supply of units that meet the FMR criteria means that investors need to carefully evaluate their potential returns. Additionally, the high percentage of renters and the tight market suggest that there may be fewer opportunities for long-term appreciation in property values. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units such as 0BR and 1BR apartments. These units have lower FMRs ($1270 and $1360 respectively) and are more likely to be rented by voucher holders. This strategy can help maximize cash flow while adhering to the FMR guidelines. 2. **Consider Renovations**: Investors might consider purchasing older properties at a lower price point and renovating them to meet modern standards. This can potentially increase the rental value while still keeping it within the FMR range. For example, a 2BR unit with minor renovations could be rented out for $1530, which is the FMR limit. 3. **Evaluate Property Location**: Location plays a crucial role in determining the rental value. Investors should look for properties in areas with high demand and proximity to amenities such as public transportation, schools, and grocery stores. This can help justify higher rents while still attracting tenants who qualify for Section 8 vouchers. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 60637 is to **Hold**. While there are opportunities to generate cash flow through smaller units and strategic renovations, the high price-to-FMR ratio and limited supply of affordable units make it challenging to achieve significant profits. Investors should carefully assess the local market conditions and consider diversifying their portfolio across multiple ZIP codes to mitigate risks. In summary, ZIP code 60637 presents a mixed picture for Section 8 investors. The strong demand for rental properties and the high percentage of renters create a robust market, but the high median home values and limited supply of units meeting FMR criteria pose significant challenges. Therefore, a cautious approach is recommended, focusing on smaller units and strategic locations to optimize cash flow and investment returns.

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.