Location: Peoria, IL | Metro: Peoria, 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 | $970 |
| 1 Bedroom | $1,020 |
| 2 Bedrooms | $1,280 |
| 3 Bedrooms | $1,640 |
| 4 Bedrooms | $1,810 |
| 5 Bedrooms | $2,100 |
| 6 Bedrooms | $2,352 |
| 7 Bedrooms | $2,540 |
| 8 Bedrooms | $2,667 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,280 | $154,156 | 0.83% | C |
| 3BR | $1,640 | $207,571 | 0.79% | D |
| 4BR | $1,810 | $356,130 | 0.51% | F |
| 5BR | $2,100 | $409,898 | 0.51% | F |
U.S. Census Bureau data (2024)
The analysis for ZIP code 61571, located in Washington, IL, reveals a critical gap between the Fair Market Rent (FMR) and the actual market rent. The FMR for FY 2024 is set at $1020, while the Census ACS reports the market rent at $988. This means that the FMR is higher than the market rent by $32, or approximately 3.2%.
In this scenario where the FMR exceeds the market rent, landlords and small-portfolio investors can leverage this discrepancy to their advantage. Voucher tenants provide a stable source of income because their rent is guaranteed by the government, making it a reliable yield play. For instance, a landlord can charge $1020 per month for a unit, which is above the typical market rate of $988, and still be within the acceptable range for voucher recipients. This strategy can help offset the costs associated with maintaining rental properties and managing tenants.
Washington, IL has a relatively low percentage of renters at 19.5%, indicating that homeownership is prevalent in the area. The median home value stands at $226,516, reflecting a moderate housing market. However, the median income is $90,386, suggesting that many residents might find it challenging to afford homeownership, thereby increasing the potential demand for rental properties, especially those that accept housing vouchers.
The cost of housing voucher tenants below open-market rates is minimal when the FMR is higher than the market rent. Landlords can effectively charge the higher FMR rate and still attract tenants who qualify for assistance. This plays well into the hands of investors looking to maximize returns without compromising on tenant quality or property management standards. Given the local economic conditions, the yield from renting to voucher tenants can be significantly higher than the average market rent, thus providing a strong incentive for participation in the Section 8 program.
To summarize, the gap between the FMR and market rent in Washington, IL (ZIP 61571) presents an opportunity for landlords and small-portfolio investors to increase their rental income by accepting Section 8 vouchers. This strategy aligns with the local economic context, where a significant portion of the population might benefit from rental assistance programs, ensuring a steady and reliable stream of tenants and income.
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.