Location: Washington County, IL | Metro: Perry County, IL
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 | $650 |
| 1 Bedroom | $860 |
| 2 Bedrooms | $940 |
| 3 Bedrooms | $1,280 |
| 4 Bedrooms | $1,390 |
| 5 Bedrooms | $1,612 |
| 6 Bedrooms | $1,805 |
| 7 Bedrooms | $1,949 |
| 8 Bedrooms | $2,046 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $940 | $142,541 | 0.66% | D |
| 3BR | $1,280 | $166,730 | 0.77% | D |
U.S. Census Bureau data (2024)
A skeptical investor looking into ZIP code 62263 in Illinois might raise several concerns regarding the viability of investing in properties under the Section 8 program. Here are three common objections and how the data addresses them.
Objection 1: Will the Fair Market Rent (FMR) of $950 (for metro FY 2026) cover the mortgage on a $168,728 home?
The data indicates that the FMR of $950 should be sufficient to cover the mortgage payments on a $168,728 home, assuming a standard 30-year fixed-rate mortgage. Using an average interest rate, the monthly mortgage payment for such a property would likely fall below the FMR threshold, making it financially viable. However, the exact amount will depend on the current interest rates and any additional costs such as property taxes and insurance.
Objection 2: Is there enough renter demand at 19.3%?
The 19.3% rental rate suggests a moderate level of demand within ZIP 62263. While this percentage is not exceptionally high, it does indicate that nearly one-fifth of the housing units are rented out. This can be considered a reasonable demand for rental properties, especially when targeting the Section 8 market. It's important to note that the rental rate alone doesn't provide a complete picture; other factors such as vacancy rates and population growth trends should also be analyzed to understand the overall demand for rentals in the area.
Objection 3: Will vouchers keep pace with market rents of $797?
The FMR of $950 is higher than the current market rent of $797, which means that vouchers could potentially cover more than the average rent in the area. However, the question of whether voucher amounts will keep up with increasing market rents over time is crucial. The data does not provide a direct answer to this trend, but historically, HUD has adjusted FMRs annually based on changes in the housing market. Landlords and investors should monitor these adjustments closely to ensure that their income from voucher payments remains competitive with market rents.
In conclusion, while ZIP 62263 presents some challenges, the data supports the notion that it can be a viable investment for those interested in the Section 8 program. The FMR covers the mortgage, the rental rate suggests moderate demand, and the current voucher amount exceeds the market rent. Continued monitoring of local real estate trends and federal adjustments to FMRs will be key to maintaining profitability.
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.