Location: Bond County, IL | Metro: St. Louis, MO-IL HUD Metro FMR Area
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 | $990 |
| 1 Bedroom | $1,030 |
| 2 Bedrooms | $1,260 |
| 3 Bedrooms | $1,620 |
| 4 Bedrooms | $1,870 |
| 5 Bedrooms | $2,169 |
| 6 Bedrooms | $2,429 |
| 7 Bedrooms | $2,623 |
| 8 Bedrooms | $2,754 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,260 | $144,002 | 0.87% | C |
| 3BR | $1,620 | $208,537 | 0.78% | D |
| 4BR | $1,870 | $303,864 | 0.62% | D |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 62231 in Illinois provides insight into the potential rental income for landlords and small-portfolio investors. Using the Fair Market Rent (FMR) for a two-bedroom apartment at $1110 per month as set for FY 2024, and the Census ACS reported market rent of $975 per month, we can calculate the implied gross yields.
First, annualizing the FMR of $1110 gives us an annual rent of $13,320. Dividing this by the median home value of $179,334 yields an implied gross yield of approximately 7.4%. This calculation suggests that if a landlord were to rely solely on the Section 8 program, they could expect a gross yield of 7.4% based on the fair market rent standards.
Second, using the market rent figure of $975 per month, the annual rent becomes $11,700. When divided by the median home value of $179,334, this results in an implied gross yield of about 6.5%. This scenario indicates a slightly lower gross yield compared to the FMR-based calculation, reflecting the actual market conditions as observed in the area.
The 15.8% renter density in ZIP 62231 implies that a significant portion of the housing market is owner-occupied, which could affect the demand for rental properties. Given the limited data on days on market (DOM), it's difficult to predict how quickly a property would be leased under either scenario. However, the N/A for DOM suggests that there might not be enough data to provide a reliable average, indicating a need for further local research.
Between the two scenarios, the market rent figure of $975 per month is more likely to represent the realistic rental income for landlords. The gap between the FMR and market rent highlights the importance of understanding local rental dynamics when assessing investment opportunities. While the Section 8 program offers a guaranteed income stream, the gross yield is lower than what might be achievable through market rents, although this depends on the ability to find and retain tenants willing to pay the higher rate.
To summarize, the gross yield for a Section 8 property in ZIP 62231 is around 7.4%, while the market rent suggests a yield of approximately 6.5%. Investors should consider these figures alongside the local rental market conditions and tenant demographics before making investment decisions.
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.