Location: St. Louis, MO | Metro: St. Louis, MO-IL HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,040 |
| 1 Bedroom | $1,080 |
| 2 Bedrooms | $1,320 |
| 3 Bedrooms | $1,690 |
| 4 Bedrooms | $1,950 |
| 5 Bedrooms | $2,262 |
| 6 Bedrooms | $2,533 |
| 7 Bedrooms | $2,736 |
| 8 Bedrooms | $2,873 |
U.S. Census Bureau data (2024)
When considering whether to invest in ZIP 63051 (House Springs, MO) for Section 8 properties, follow these steps:
1. Does FMR $1200 clear debt service on a $276,769 property?
Yes. The Fair Market Rent (FMR) of $1200 is sufficient to cover the average monthly mortgage payment for a property valued at $276,769. Assuming a typical 30-year fixed-rate mortgage at an interest rate of around 5%, the monthly principal and interest would be approximately $1,480. This does not include property taxes, insurance, and maintenance costs which typically add another $200-$300 per month. Therefore, the FMR does not fully cover the total debt service, but it comes close, especially if the property has low taxes and insurance.
No. The FMR of $1200 does not fully cover the total debt service, including all associated costs, on a $276,769 property. However, this can still be a viable investment if other income sources or subsidies are available to make up the difference.
It depends. The viability of covering debt service with FMR alone hinges on the specific terms of the mortgage and local tax and insurance rates. If these costs are lower than average, the FMR might suffice. Otherwise, additional income or subsidies will be necessary.
2. Is market rent $1,074 above, at, or below FMR?
Above. The market rent of $1,074 is below the FMR of $1200, indicating that properties in ZIP 63051 could potentially be rented out for slightly higher rates than the market average, benefiting from the higher FMR.
At. The market rent of $1,074 is close to the FMR, suggesting that renting at the FMR would be competitive with the local market.
Below. Since the market rent is already below the FMR, there is no indication that rents will drop further. This makes ZIP 63051 attractive for Section 8 investments as the FMR provides a higher rental income.
3. Are 15.6% renters + N/A-day DOM enough demand?
Yes. With 15.6% of the population being renters, there is a reasonable base of potential tenants. However, the lack of data on Days on Market (DOM) means we cannot assess how quickly units are leased. In a stable housing market, this percentage of renters suggests sufficient demand.
No. Without specific DOM data, it's impossible to determine how long units remain vacant. High DOM values could indicate weak demand. Given only 15.6% of residents are renters, landlords must ensure they can attract and retain tenants.
It depends. The 15.6% of renters indicates some demand, but the absence of DOM data leaves uncertainty about leasing speed. Landlords should consider local market conditions and possibly seek additional data to better gauge tenant demand.
In conclusion, ZIP 63051 presents a mixed scenario for Section 8 investment. The FMR provides a competitive rental rate compared to the market, but the feasibility of covering total debt service requires further investigation into specific property costs. Sufficient tenant demand exists, though the lack of DOM data introduces a variable that needs addressing before making a final decision.
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.