Location: Rockford, IL | Metro: Rockford, IL MSA
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 | $730 |
| 1 Bedroom | $810 |
| 2 Bedrooms | $1,060 |
| 3 Bedrooms | $1,400 |
| 4 Bedrooms | $1,440 |
| 5 Bedrooms | $1,670 |
| 6 Bedrooms | $1,870 |
| 7 Bedrooms | $2,020 |
| 8 Bedrooms | $2,121 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,400 | $242,991 | 0.58% | F |
U.S. Census Bureau data (2024)
A skeptical investor looking at ZIP code 61024 might have several concerns regarding the feasibility of investing in properties under the Section 8 program. Here's a direct analysis addressing those points.
Will the Fair Market Rent (FMR) of $850 for ZIP 61024 cover the mortgage on a $220,515 home?
The FMR of $850 is a critical figure for determining if an investment in ZIP 61024 can be profitable under the Section 8 program. To understand whether this amount covers a mortgage, we must consider the prevailing interest rates and typical loan terms. Assuming a standard 30-year fixed-rate mortgage with an interest rate of around 5%, the monthly payment on a $220,515 home would be approximately $1,180. This means that the FMR of $850 falls short by about $330 per month. However, it's important to note that the FMR is the maximum allowable rent, and actual rents could be lower, depending on the property's condition and location. Additionally, the FMR is adjusted annually, so future increases could potentially bridge this gap.
Is there enough renter demand at 19.4%?
The percentage of renters in ZIP 61024 is 19.4%. While this figure might seem low compared to urban areas where rental demand is typically higher, it still represents a significant portion of the housing market. For a Section 8 investor, the key consideration is not just the overall rental demand but also the specific demand for subsidized housing. The data does not provide a breakdown of how many of these renters are seeking government-subsidized housing. However, given the presence of the Section 8 program, there is likely a steady stream of tenants who qualify for and seek out subsidized housing options. The demand for Section 8 housing tends to be more consistent and less affected by market fluctuations compared to the general rental market.
Will vouchers keep pace with market rents of $796?
The market rent in ZIP 61024 is $796, which is below the FMR of $850. The question of whether vouchers will keep pace with market rents hinges on the annual adjustments made by HUD to the FMR. Historically, the FMR has increased in line with inflation and changes in the local housing market. If the FMR remains stable or increases, it should continue to cover the market rent of $796. However, the data does not provide projections for future FMR adjustments. It's crucial for investors to monitor local housing trends and HUD announcements to ensure that the voucher amounts remain competitive with market rents. In ZIP 61024, where the FMR exceeds the market rent, there is currently no immediate risk of vouchers falling behind.
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.