Section 8 Fair Market Rent (FMR) for ZIP 61333 - 2027

FY 2027 Fair Market Rent Rates

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

To determine if you should buy a property in ZIP code 61333 for Section 8 investment, follow this decision tree based on the data provided:

Step 1: Debt Service Coverage Ratio (DSCR)

Does the Fair Market Rent (FMR) of $950 cover the debt service on a property valued at $145,454?

• No. The FMR does not clear the debt service on a property worth $145,454. At $950 per month, the annual income would be $11,400. This is insufficient to meet the expected annual debt service for a property of that value, which likely exceeds this amount. Therefore, do not proceed with purchasing in this area for Section 8 purposes.
• It Depends. If you're considering properties under the $145,454 mark, evaluate whether the FMR can cover the debt service. However, given the data, properties at this valuation level are unlikely to generate sufficient income from Section 8 tenants to cover costs.

Step 2: Market Rent Comparison

If the FMR clears the debt service, compare the market rent (N/A) to the FMR.

• Market Rent Above FMR. If the market rent is higher than the FMR of $950, then there's potential for profit beyond Section 8 subsidies. However, since the market rent is listed as N/A, this step cannot be fully evaluated without additional data.
• Market Rent Equal to FMR. If the market rent equals the FMR, then the property will break even with Section 8 subsidies, assuming all other factors align. Again, this requires knowing the actual market rent.
• Market Rent Below FMR. If the market rent is lower than the FMR, then the property could be overvalued relative to what the market supports. Since the market rent is N/A, this scenario is also indeterminate.

Step 3: Demand Evaluation

Assess the demand by looking at the percentage of renters (4.8%) and the average days on the market (DOM, N/A).

• It Depends. With only 4.8% of the population being renters, the demand for rental properties might be low. However, without the DOM figure, it's impossible to gauge how quickly properties are rented out once they become available. A low DOM indicates strong demand, while a high DOM suggests otherwise. In this case, the lack of DOM data means the decision hinges on other factors such as the local economy and job market stability.

In conclusion, based on the provided data, the FMR of $950 does not sufficiently cover the debt service on a $145,454 property. Furthermore, the limited renter population (4.8%) and the absence of critical market data (market rent and DOM) make it difficult to recommend purchasing in ZIP 61333 for Section 8 investment without further investigation into local economic conditions and rental market specifics.

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.