Location: Kansas City, MO | Metro: Kansas City, MO-KS 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 | $1,060 |
| 1 Bedroom | $1,160 |
| 2 Bedrooms | $1,310 |
| 3 Bedrooms | $1,710 |
| 4 Bedrooms | $2,050 |
| 5 Bedrooms | $2,378 |
| 6 Bedrooms | $2,663 |
| 7 Bedrooms | $2,876 |
| 8 Bedrooms | $3,020 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,310 | $156,061 | 0.84% | C |
| 3BR | $1,710 | $218,683 | 0.78% | D |
| 4BR | $2,050 | $276,448 | 0.74% | D |
| 5BR | $2,378 | $329,919 | 0.72% | D |
U.S. Census Bureau data (2024)
The Section 8 cap-rate picture for ZIP 64030 in Grandview, MO, reveals interesting insights for landlords and small-portfolio investors. For a two-bedroom unit, the Fair Market Rent (FMR) for fiscal year 2024 is set at $1050 per month, while the Zillow Observed Rent Index (ZORI) indicates a market rent of $1415 monthly.
To annualize these figures, we multiply the monthly rents by 12. The annualized FMR for a two-bedroom unit is $12,600 ($1050 x 12), and the annualized ZORI is $17,000 ($1415 x 12).
The median home value in ZIP 64030 is $216,648. Using this figure, we can calculate the implied gross yield for both scenarios. For the FMR scenario, the gross yield is approximately 5.82%, calculated as $12,600 divided by $216,648. In contrast, the gross yield based on the ZORI is about 7.85%, computed as $17,000 divided by $216,648.
Given that 50.8% of residents in Grandview are renters and the average days on market (DOM) is 21 days, it's reasonable to conclude that the market rent scenario is more realistic. This is because the low DOM suggests a high demand for rental properties, aligning with the higher renter density and supporting the likelihood of achieving market rents rather than relying solely on Section 8 rates.
In summary, while the Section 8 FMR provides an annualized income of $12,600, leading to a gross yield of 5.82%, the market conditions in ZIP 64030 indicate that investors should expect a gross yield closer to 7.85%, based on the ZORI. The significant difference in yields underscores the importance of considering market dynamics when evaluating potential investment returns in this area.
Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.