Section 8 Fair Market Rent (FMR) for ZIP 63116 - 2027

Investment Score for ZIP 63116

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,030
1 Bedroom	$1,070
2 Bedrooms	$1,310
3 Bedrooms	$1,680
4 Bedrooms	$1,940
5 Bedrooms	$2,250
6 Bedrooms	$2,520
7 Bedrooms	$2,722
8 Bedrooms	$2,858

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,070	$133,307	0.8%	C
2BR	$1,310	$180,801	0.72%	D
3BR	$1,680	$233,227	0.72%	D
4BR	$1,940	$319,762	0.61%	D
5BR	$2,250	$444,900	0.51%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 63116 (Saint Louis, MO) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) figures for ZIP code 63116 in Saint Louis, Missouri, provide a benchmark for rental costs that are relevant for Section 8 voucher holders. According to the 2026 FMR data, the rates are as follows: - 0BR: $920 - 1BR: $960 - 2BR: $1170 - 3BR: $1510 - 4BR: $1740 These figures represent the maximum rent that a voucher holder can pay based on their household size. However, it is important to compare these FMRs to the actual rents in the area to understand the dynamics better. The price-to-FMR ratio for a 2BR unit is 12.5x, which means the actual median home value for a 2BR unit is $175,929. This suggests that the actual rents in the area could be significantly higher than the FMRs, creating a challenge for voucher holders who might struggle to find units within their budget. For instance, a voucher holder with a 2BR unit would have to pay $1170 per month, but if the actual rent exceeds this amount, they would need to cover the difference out-of-pocket. Given the median household income of $61,433, this could be a significant burden, especially considering that 2BR units at FMR represent approximately 22.9% of the median income. Therefore, voucher holders face a tight market where finding affordable housing can be difficult. #### Affordability & Renter Profile ZIP code 63116 has a population of 42,170, with 43.1% being renters. This indicates a substantial demand for rental properties in the area. The occupancy rate of 88.9% further supports the notion that the rental market is relatively robust and not oversupplied. With a significant portion of the population renting, the affordability of housing becomes a critical issue. Given the median household income and the FMRs, we can infer that the majority of renters are likely to be low-income families who rely heavily on assistance programs such as Section 8 vouchers. These individuals are sensitive to changes in rent and housing costs, making the market somewhat volatile. The high price-to-FMR ratio also suggests that the market is tight, with many units priced well above the FMRs, leading to potential competition among voucher holders and other low-income renters for the limited number of affordable units. #### Investor Angle From an investor's perspective, the key question is whether the rental market in ZIP code 63116 is cash-flow positive at the FMR levels. Given the FMRs and the actual median home values, it is clear that the market is highly inflated compared to the FMRs. For example, a 2BR unit at FMR is $1170, while the actual median home value is $175,929. This implies that investors who purchase properties at or near the median home value would likely need to charge rents significantly higher than the FMRs to achieve positive cash flow. However, the investment grade in this ZIP code depends on several factors, including the ability to attract tenants willing to pay above FMR rates and the overall demand for rental properties. Since the occupancy rate is high at 88.9%, there is a strong indication that demand is steady. But, the challenge lies in balancing the rent charged with the affordability constraints faced by voucher holders and other low-income renters. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Investors should consider focusing on smaller units like 0BR and 1BR apartments, which have lower FMRs ($920 and $960 respectively). These units are more likely to be within the budget of voucher holders and may offer a better chance of securing tenants without significant rent concessions. 2. **Target Affordable Housing Projects**: Given the high price-to-FMR ratio, investors should look into projects that specifically target affordable housing. This could involve seeking government grants or subsidies that help keep rents closer to FMR levels, thereby attracting more voucher holders and ensuring a steady stream of tenants. 3. **Consider Mixed-Income Developments**: To balance the financial viability of investments with the need for affordable housing, mixed-income developments can be a viable strategy. By offering a mix of units at different price points, investors can cater to both voucher holders and higher-income renters, thus optimizing cash flow while still providing affordable options. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 63116 is to **Hold**. While the market presents challenges due to the high price-to-FMR ratio and the tight rental environment, there is still a significant demand for affordable housing. Investing in smaller units or affordable housing projects could mitigate some of these risks, but the overall market conditions suggest that it may be prudent to wait for more favorable pricing or seek alternative strategies to ensure financial stability.

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.