Location: Bureau County, IL | Metro: Bureau County, IL
| Unit Size | Monthly FMR |
|---|---|
| Studio | $650 |
| 1 Bedroom | $720 |
| 2 Bedrooms | $940 |
| 3 Bedrooms | $1,160 |
| 4 Bedrooms | $1,290 |
| 5 Bedrooms | $1,496 |
| 6 Bedrooms | $1,676 |
| 7 Bedrooms | $1,810 |
| 8 Bedrooms | $1,901 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 61315 reveals a stark contrast between federal market rent (FMR) and market rent rates, impacting potential gross yields for landlords and small-portfolio investors.
Based on the data provided, the annualized FMR for a 2BR unit in FY 2026 is set at $970. This figure translates into an annual rental income of $11,640 per unit. Given that the median home value is not available, we cannot directly calculate a cap rate using traditional methods. However, we can infer the gross yield from the FMR. Assuming a property value based on comparable local values, the gross yield would be lower due to the significantly reduced rental income compared to market rates.
In contrast, the market rent for a 2BR unit in ZIP 61315 stands at $1,714, according to the Census ACS. This equates to an annual rental income of $20,568 per unit. Again, without a specific median home value, we cannot provide a precise cap rate. Nevertheless, it's clear that the gross yield from market rents would be higher, reflecting better returns on investment.
The gross-yield comparison is straightforward: a property rented under the Section 8 program at the FMR of $970 per month would generate an annual income of $11,640, whereas renting at the market rate of $1,714 would produce an annual income of $20,568. The difference in gross yield highlights the financial implications of choosing one rental model over the other.
Given the 37.5% renter density in ZIP 61315, landlords should consider the likelihood of finding tenants willing to pay market rates. Additionally, the lack of data on the days on market (DOM) makes it challenging to predict how quickly a property might fill when advertised for market rates versus FMR. However, the higher gross yield from market rents suggests greater financial stability and profitability for landlords and investors, assuming they can secure tenants at these levels.
In conclusion, while the exact cap rate cannot be calculated without the median home value, the gross-yield comparison clearly favors market rents over FMRs. Landlords and investors should weigh the benefits of higher gross yields against the potential challenges of maintaining occupancy at market rates.
Data Sources: FMR data from HUD (2027). 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.