Location: St. Louis, MO | Metro: St. Louis, MO-IL HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $820 |
| 1 Bedroom | $850 |
| 2 Bedrooms | $1,040 |
| 3 Bedrooms | $1,330 |
| 4 Bedrooms | $1,540 |
| 5 Bedrooms | $1,786 |
| 6 Bedrooms | $2,000 |
| 7 Bedrooms | $2,160 |
| 8 Bedrooms | $2,268 |
U.S. Census Bureau data (2024)
The potential risks for investing in Section 8 housing in ZIP code 62204 are significant. Tenant turnover is a critical issue, as the market rent stands at $831, which is notably lower than the Fair Market Rent (FMR) of $1020 for fiscal year 2024. This discrepancy suggests that landlords may struggle to find tenants willing to pay the higher FMR rate required by Section 8 vouchers, leading to frequent turnover and the associated costs of finding new tenants and preparing units for occupancy.
Vacancy exposure is another concern. The Days on Market (DOM) figure is not available, which implies that there might be a lack of timely data on how quickly properties are rented out. This uncertainty can pose a financial risk, as extended vacancies can significantly impact cash flow and profitability.
Deferred maintenance is also a risk factor. With a typical home value of $40,280 and a median household income of $35,346, many residents in ZIP 62204 may not have the financial means to keep their homes in optimal condition. Landlords must be prepared to address any maintenance issues promptly to ensure compliance with housing quality standards and avoid costly repairs down the line.
Despite these challenges, the high renter share of 22.9% in the area indicates a robust demand for rental properties. High renter density often correlates with higher demand for Section 8 vouchers, which can provide a steady stream of tenants for landlords who are willing to participate in the program. This demand can help mitigate some of the risks associated with vacancy and turnover, as landlords are more likely to find eligible tenants.
Verdict: Moderate risk for a first-time Section 8 landlord.
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.