Location: Springfield, IL | Metro: Springfield, IL MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $860 |
| 1 Bedroom | $980 |
| 2 Bedrooms | $1,240 |
| 3 Bedrooms | $1,630 |
| 4 Bedrooms | $1,730 |
| 5 Bedrooms | $2,007 |
| 6 Bedrooms | $2,248 |
| 7 Bedrooms | $2,428 |
| 8 Bedrooms | $2,549 |
U.S. Census Bureau data (2024)
The ZIP code 62625, located within the Springfield, IL MSA, presents a strategic opportunity for Section 8 landlords and small-portfolio investors. This area can be considered a cash-flow anchor within a portfolio due to the favorable spread between the Fair Market Rent (FMR) for FY 2024 and the market rental rates.
The FMR for a one-bedroom apartment in ZIP 62625 for FY 2024 is set at $1050. In contrast, the current market rental rate is slightly lower at $1,036. This indicates that properties rented through the Section 8 program could potentially provide a stable cash flow, given the government subsidy covers the difference between the market rate and the FMR.
Additionally, the median home value in ZIP 62625 is $300,986, reflecting a modest increase of 7.9% over the past year. This growth suggests a steady appreciation trend, which aligns well with a cash-flow anchor strategy. While the area does not exhibit explosive appreciation potential, the moderate growth provides a solid foundation for long-term investment stability.
The renter share in ZIP 62625 is 20.8%, indicating a significant portion of the population relies on rental housing. Coupled with a median household income of $167,674, this ZIP code demonstrates strong demand for affordable housing options, making it an ideal location for Section 8 properties. Landlords can benefit from the consistent tenant base supported by government subsidies, reducing vacancy risks and ensuring reliable cash flow.
In summary, ZIP 62625 serves as a cash-flow anchor within a Section 8 portfolio strategy. The slight premium in FMR over market rates, combined with a modest appreciation trend and a substantial renter share, positions this area as a secure and predictable investment choice. Landlords and small-portfolio investors should focus on maintaining high-quality, well-managed properties to maximize the benefits of this strategy.
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.