Section 8 Fair Market Rent (FMR) for ZIP 62045 - 2027

FY 2027 Fair Market Rent Rates

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

A skeptical investor analyzing ZIP code 62045 might raise several concerns regarding the feasibility of investing in rental properties under the Section 8 program. Let's delve into these concerns and address them with the available data.

• Will FMR $930 (zip FY 2024) cover the mortgage on a $173,703 home? The Fair Market Rent (FMR) for ZIP 62045 in fiscal year 2024 is set at $930. To determine if this amount will sufficiently cover the mortgage on a property valued at $173,703, we must consider the typical mortgage rates and terms. Assuming a standard 30-year fixed-rate mortgage at an average rate of 5%, the monthly payment would be approximately $922. This calculation does not include property taxes, insurance, and maintenance costs, which can add significantly to the total monthly expenses. However, the FMR of $930 is just above the estimated mortgage payment, indicating that it could potentially cover the mortgage cost, but only marginally without additional income sources.

• Is there enough renter demand at 1.8%? The percentage of renter-occupied households in ZIP 62045 stands at 1.8%. This figure is quite low compared to national averages, suggesting a limited pool of potential renters. For landlords and small-portfolio investors, this could mean a higher risk of vacancy and difficulty in filling units. However, it's important to note that the demand for affordable housing can still exist even in areas with low overall rental rates. Additionally, the concentration of renters may be in specific neighborhoods or areas within the ZIP code, which could offer opportunities despite the general statistic.

• Will vouchers keep pace with N/A market rents? The availability of accurate market rent data for ZIP 62045 is currently lacking, making it challenging to assess whether voucher amounts will keep up with actual rental costs. Without precise figures, it's difficult to provide a definitive answer. However, historically, the Housing Choice Voucher Program aims to cover a significant portion of the market rent, typically up to the FMR. Given the FMR of $930, one can expect that voucher payments will be close to this amount, though they often do not exceed it. Landlords should be prepared for the possibility that voucher payments may not fully match the local market rents, especially if those rents exceed the FMR.

In conclusion, while the FMR of $930 appears to align closely with the expected mortgage payment on a $173,703 home, the low renter demand at 1.8% and the lack of detailed market rent data present notable challenges. These factors must be carefully considered before committing to investment in the Section 8 program within ZIP 62045.

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.