Location: St. Louis, MO | 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 | $780 |
| 1 Bedroom | $810 |
| 2 Bedrooms | $990 |
| 3 Bedrooms | $1,270 |
| 4 Bedrooms | $1,470 |
| 5 Bedrooms | $1,705 |
| 6 Bedrooms | $1,910 |
| 7 Bedrooms | $2,063 |
| 8 Bedrooms | $2,166 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,270 | $275,420 | 0.46% | F |
U.S. Census Bureau data (2024)
Skeptical investors considering real estate investments in ZIP code 62245 often raise several key concerns that need addressing before making any financial commitments. Let's break down these objections with the data available.
Objection 1: Will Fair Market Rent (FMR) of $950 (for zip code FY 2024) cover the mortgage on a $244,081 home?
The FMR of $950 is indeed a critical figure when assessing the viability of rental income in ZIP 62245. To determine if this will sufficiently cover the mortgage, we must first calculate the expected monthly mortgage payment. Assuming a 30-year fixed-rate mortgage with an interest rate of 4%, the monthly payment would be approximately $1,145. This means that the FMR of $950 falls short by $195 per month, indicating that additional income sources or lower financing costs would be necessary to ensure profitability.
Objection 2: Is there enough renter demand at 12.1%?
A rental vacancy rate of 12.1% suggests a moderate level of demand for rental properties in ZIP 62245. While it is higher than what some might consider ideal, it does not necessarily indicate a lack of demand. In fact, a higher vacancy rate can sometimes mean that there are opportunities to negotiate better terms with tenants or improve property values through renovations. However, the data alone does not provide insights into the specific reasons behind the vacancy rate or the potential for growth in the rental market.
Objection 3: Will vouchers keep pace with $903 market rents?
The market rent of $903 in ZIP 62245 is slightly below the FMR but still represents a significant portion of the total rental income. The effectiveness of voucher programs in keeping up with market rents depends on various factors, including local housing authority policies and federal funding levels. With the FMR set at $950, landlords who accept vouchers can expect a higher reimbursement rate, which should help mitigate the risk of falling behind on market rents. Nonetheless, the data does not specify the exact amount of voucher reimbursements or the likelihood of future adjustments to match rising market rents.
In conclusion, while the data provides a solid foundation for understanding the rental market dynamics in ZIP 62245, it also highlights areas where further investigation might be needed. Investors should carefully consider their financing options, the reasons behind the current vacancy rate, and the specifics of voucher programs to make informed 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.