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 | $1,130 |
| 1 Bedroom | $1,170 |
| 2 Bedrooms | $1,430 |
| 3 Bedrooms | $1,840 |
| 4 Bedrooms | $2,120 |
| 5 Bedrooms | $2,459 |
| 6 Bedrooms | $2,754 |
| 7 Bedrooms | $2,974 |
| 8 Bedrooms | $3,123 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,840 | $230,734 | 0.8% | D |
| 4BR | $2,120 | $326,478 | 0.65% | D |
U.S. Census Bureau data (2024)
A skeptical investor might question whether the Fair Market Rent (FMR) of $1,330 for ZIP 62265 in fiscal year 2024 will sufficiently cover the mortgage on a home valued at $223,282. To address this concern, we must consider the typical mortgage rates and terms. Assuming a 30-year fixed-rate mortgage with an interest rate of around 5%, the monthly payment on a $223,282 home would be approximately $1,200. This means that the FMR does indeed cover the mortgage payment, leaving a buffer for property taxes, insurance, and maintenance costs.
The second objection revolves around the renter demand in ZIP 62265, which stands at 32.7%. A potential investor could argue that this percentage is too low to ensure a steady stream of tenants. However, the reality is that while 32.7% may seem modest, it represents a significant portion of the population. Moreover, the vacancy rate in the area can provide additional insight into the rental market's health. If the vacancy rate is low, it indicates strong demand despite the percentage being less than half. Unfortunately, the provided data does not include the vacancy rate, so we cannot definitively conclude the strength of demand based solely on the 32.7% figure.
Lastly, an investor might question if Housing Choice Vouchers will keep pace with the market rents of $1,144. The voucher amount is tied to the FMR and adjusts annually based on changes in housing costs. While the current voucher amount may not fully cover the market rent, it typically covers a substantial portion. In ZIP 62265, the voucher amount is expected to be close to the FMR of $1,330. Therefore, even if there is a slight gap between the voucher amount and market rents, the difference is manageable and should not significantly impact the overall profitability of renting to voucher holders.
In summary, the FMR of $1,330 for ZIP 62265 in fiscal year 2024 does cover the mortgage on a $223,282 home, and the voucher program is likely to remain competitive with market rents. The 32.7% renter demand statistic requires additional context to fully assess its implications, but it suggests a viable market for rental properties.
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.