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 | $2,170 |
| 1 Bedroom | $2,300 |
| 2 Bedrooms | $2,600 |
| 3 Bedrooms | $3,340 |
| 4 Bedrooms | $3,820 |
| 5 Bedrooms | $4,431 |
| 6 Bedrooms | $4,963 |
| 7 Bedrooms | $5,360 |
| 8 Bedrooms | $5,628 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $2,300 | $213,926 | 1.08% | B |
| 2BR | $2,600 | $418,281 | 0.62% | D |
| 3BR | $3,340 | $637,097 | 0.52% | F |
| 4BR | $3,820 | $1,141,738 | 0.33% | F |
| 5BR | $4,431 | $1,676,402 | 0.26% | F |
U.S. Census Bureau data (2024)
Chicago’s 60640 ZIP code, encompassing the vibrant Uptown and parts of Edgewater, is a dense, transit-oriented lakefront neighborhood known for its historic architecture and diverse commercial corridors. The area is a major cultural hub, anchored by institutions like the Riviera Theatre and the Aragon Ballroom, which drive consistent foot traffic and local employment. The neighborhood features a mix of high-rise lakefront condos and greystone two- and three-flats, creating a varied housing stock that appeals to a wide demographic of renters seeking proximity to downtown and the lake.
From a numerical standpoint, the Section 8 opportunity here is defined by a favorable spread between subsidy caps and market reality. The HUD SAFMR for a 2BR unit is $2,170, while the current market rent (Zillow ZORI) sits lower at $1,933, generating a gross cash flow gap of $237 per month before expenses. For investors acquiring assets, the median home value is $344,532, with a median 2BR sale price of $383,069. Properties are moving at a moderate pace, with a median of 43 days on market, indicating a stable but competitive environment.
Demand is robust, driven by a high renter share of 68.2% and a median household income of $73,254. This income level suggests that while many residents can afford market rates, there is a significant portion of the population that benefits from housing assistance. The neighborhood’s desirability is bolstered by excellent access to the CTA Red and Purple Lines, highly rated public schools such as Uplift Community High School, and expansive green spaces like Montrose Beach. These amenities ensure a steady pool of applicants, including voucher holders seeking quality housing in a prime location.
The Section 8 verdict for 60640 is strongly positive for cash flow and stability. The specific data shows a clear premium where the 2BR SAFMR exceeds market rents by approximately 12%, allowing investors to achieve above-market yields with the added security of government-backed payments. Combined with a high renter concentration and desirable neighborhood amenities, this area offers a defensive investment with immediate income potential.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.