Location: St. Louis, MO | Metro: St. Louis, MO-IL HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $760 |
| 1 Bedroom | $790 |
| 2 Bedrooms | $960 |
| 3 Bedrooms | $1,230 |
| 4 Bedrooms | $1,420 |
| 5 Bedrooms | $1,647 |
| 6 Bedrooms | $1,845 |
| 7 Bedrooms | $1,993 |
| 8 Bedrooms | $2,093 |
The analysis for ZIP code 62065 in Missouri reveals some key insights into the potential for Section 8 properties in this area. However, due to limited data availability, the following assessment is based on the provided figures and reasonable assumptions.
The Fair Market Rent (FMR) for a two-bedroom property in ZIP 62065 for fiscal year 2024 is set at $930 per month. This annualizes to $11,160. Given that the market rent is not available, we can only compare the FMR to the median home value, which is also not provided. Therefore, we cannot calculate an exact cap rate or gross yield for the market rent scenario. Instead, we will focus on the Section 8 scenario.
In the context of Section 8, the gross yield would be calculated based on the annualized FMR. Without the median home value, we cannot provide a precise gross yield percentage, but we can state that the monthly rental income would be capped at $930. This figure represents the maximum amount a landlord could receive from a Section 8 tenant for a two-bedroom unit in this ZIP code.
Given the lack of data on median home values and market rents, it's difficult to provide a direct comparison between the two scenarios. However, the Section 8 scenario offers a guaranteed, albeit fixed, level of income through government subsidies. This stability can be attractive to investors looking for consistent cash flow rather than fluctuating market rates.
The absence of specific figures for renter density and days on market (DOM) further complicates a detailed analysis. However, it's worth noting that these metrics are crucial for understanding the local housing market dynamics. High renter density and low DOM typically indicate a robust rental market, which could be favorable for both Section 8 and market-rate investments.
While the data provided is insufficient for a comprehensive cap rate analysis, the $930 monthly FMR for a two-bedroom unit in ZIP 62065 is a critical starting point for any investor considering Section 8 properties. The decision to invest should consider the trade-offs between guaranteed income and the potential for higher yields from market-rate rentals, once more data becomes available.
Data Sources: FMR data from HUD (2027).
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.