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 | $840 |
| 1 Bedroom | $870 |
| 2 Bedrooms | $1,060 |
| 3 Bedrooms | $1,360 |
| 4 Bedrooms | $1,570 |
| 5 Bedrooms | $1,821 |
| 6 Bedrooms | $2,040 |
| 7 Bedrooms | $2,203 |
| 8 Bedrooms | $2,313 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,060 | $199,075 | 0.53% | F |
| 3BR | $1,360 | $284,225 | 0.48% | F |
| 4BR | $1,570 | $354,070 | 0.44% | F |
U.S. Census Bureau data (2024)
To determine if you should buy in ZIP 63070 (Pevely, MO) for Section 8, follow this decision tree:
1) Does FMR $960 (zip FY 2024) clear debt service on a $275,644 property?
No: The Fair Market Rent (FMR) of $960 does not cover the debt service on a $275,644 property. Debt service includes mortgage payments, property taxes, insurance, and maintenance costs. In Pevely, MO, a property valued at $275,644 would typically require higher rental income to be financially viable. Therefore, based on the FMR alone, purchasing a property for Section 8 purposes in this area would not be advisable.
Yes: This scenario is unlikely given the typical cost structure associated with a $275,644 property. However, if your property has lower-than-average operating costs or you can secure a very favorable financing arrangement, then the FMR might cover debt service. Proceed to the next question.
2) Is market rent $871 (Census ACS) above, at, or below FMR?
Below FMR: The market rent of $871 is below the FMR of $960. This means that while Section 8 tenants might pay up to $960, the general market is willing to pay less. This could indicate a lack of demand for higher rents, making it difficult to attract non-Section 8 tenants if you wish to diversify your tenant base. Additionally, the lower market rent suggests that properties in this area are not highly sought after, which could impact resale value and long-term investment potential.
At or Above FMR: This scenario is not applicable based on the provided data. However, if market rents were closer to or exceeded the FMR, it would suggest a stronger demand for housing at or near the FMR level. Proceed to the next question.
3) Are 26.2% renters + N/A-day DOM enough demand?
It Depends: With 26.2% of the population being renters, there is some demand for rental properties. However, the Days on Market (DOM) data is not available, which makes it challenging to assess how quickly properties are rented out. A high DOM could indicate low demand or difficulty in finding tenants, whereas a low DOM would suggest a robust rental market. Without DOM data, you must rely on other indicators such as vacancy rates, local economic conditions, and the number of Section 8 vouchers available in the area.
In conclusion, based on the provided data, the FMR of $960 is insufficient to cover the debt service on a $275,644 property, and the market rent of $871 is below the FMR. These factors suggest that investing in Pevely, MO for Section 8 purposes may not be financially sound unless you can significantly reduce costs or find a way to increase rental income beyond the FMR. The rental demand, while present, cannot be fully assessed without DOM data.
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.