Section 8 Fair Market Rent (FMR) for ZIP 60659 - 2027

Investment Score for ZIP 60659

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	$1,740
1 Bedroom	$1,840
2 Bedrooms	$2,080
3 Bedrooms	$2,670
4 Bedrooms	$3,060
5 Bedrooms	$3,550
6 Bedrooms	$3,976
7 Bedrooms	$4,294
8 Bedrooms	$4,509

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	$1,840	$151,148	1.22%	A
2BR	$2,080	$229,726	0.91%	C
3BR	$2,670	$449,116	0.59%	F
4BR	$3,060	$574,865	0.53%	F
5BR	$3,550	$690,851	0.51%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 60659 (Chicago, IL) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 60659 in Chicago, IL, as of 2026, is set at $1830 for a two-bedroom unit. This amount represents 32.0% of the median household income in the area, which stands at $68,704. The FMR is designed to ensure that rental units are affordable for low-income households who receive Section 8 vouchers. However, the actual rents in the market can be significantly higher. For instance, the Zillow median price for a two-bedroom unit in this ZIP code is $221,238, which translates to a monthly rent of approximately $1843.57 if financed through a mortgage with a 4.5% interest rate over 30 years. This means that the actual rent for a two-bedroom unit is slightly above the FMR, creating a constraint for voucher holders who may struggle to find units within their budget. #### Affordability & Renter Profile ZIP code 60659 has a high renter population of 53.2%, indicating a significant demand for rental properties. The occupancy rate of 93.0% suggests that the market is relatively tight, with few vacant units available. Given the median household income of $68,704, the majority of renters in this area would likely fall into the middle to lower-middle income brackets. The FMR for a three-bedroom unit is $2360, which is 34.3% of the median income, making it challenging for families with children to afford larger units. Additionally, the FMR for a four-bedroom unit is $2730, representing 39.7% of the median income, further emphasizing the affordability challenges faced by larger families. #### Investor Angle From an investor perspective, the ZIP code 60659 offers a mixed outlook. The price-to-FMR ratio of 10.1x indicates that the purchase price of properties is substantially higher compared to the rental income they generate. This high ratio could suggest that the market is overvalued relative to rental yields. To determine if this ZIP code is cash-flow positive at FMR, we need to consider the typical operating expenses and vacancy rates. Assuming a conservative vacancy rate of 5% and operating expenses of 50% of gross rental income, the net operating income (NOI) for a two-bedroom unit would be: \[ \text{Gross Rental Income} = \$1830 \times 12 = \$21,960 \] \[ \text{Operating Expenses} = \$21,960 \times 0.50 = \$10,980 \] \[ \text{Vacancy Loss} = \$21,960 \times 0.05 = \$1,098 \] \[ \text{Net Operating Income (NOI)} = \$21,960 - \$10,980 - \$1,098 = \$9,882 \] Given the median home value of $221,238, the cap rate (net operating income divided by property value) would be: \[ \text{Cap Rate} = \frac{\$9,882}{\$221,238} \approx 4.47\% \] This cap rate is relatively low, suggesting that the investment grade for properties in this ZIP code is moderate. Investors should carefully evaluate the potential for appreciation and other factors such as location, amenities, and neighborhood desirability before making investment decisions. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should focus on smaller units like one-bedroom apartments. The FMR for a one-bedroom unit is $1620, which is still a substantial portion of the median income (23.6%). Smaller units tend to have higher occupancy rates and are generally easier to manage financially. 2. **Consider Location-Specific Factors**: While the overall market may be tight, certain sub-neighborhoods within ZIP code 60659 might offer better opportunities. Investors should look for areas with lower vacancy rates and higher demand, such as those near public transportation hubs, schools, or commercial centers. 3. **Evaluate Property Condition and Amenities**: Properties with better condition and additional amenities like parking, laundry facilities, and modern appliances may command slightly higher rents while still being within the FMR limits. This could improve cash flow and make the investment more attractive. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 60659 is to **Hold**. The market is tight with a high occupancy rate, but the price-to-FMR ratio is quite high, indicating limited cash flow potential. Investing in smaller units or properties with added amenities might provide some margin for improvement, but the overall investment grade remains moderate due to the high purchase costs relative to rental yields. Therefore, unless there are specific opportunities with favorable conditions, investors should hold off on new acquisitions and focus on maintaining existing properties to maximize 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.