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 | $1,190 |
| 1 Bedroom | $1,300 |
| 2 Bedrooms | $1,470 |
| 3 Bedrooms | $1,920 |
| 4 Bedrooms | $2,300 |
| 5 Bedrooms | $2,668 |
| 6 Bedrooms | $2,988 |
| 7 Bedrooms | $3,227 |
| 8 Bedrooms | $3,388 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,300 | $267,397 | 0.49% | F |
| 2BR | $1,470 | $239,833 | 0.61% | D |
| 3BR | $1,920 | $297,403 | 0.65% | D |
| 4BR | $2,300 | $418,395 | 0.55% | F |
| 5BR | $2,668 | $526,706 | 0.51% | F |
U.S. Census Bureau data (2024)
A skeptical investor analyzing ZIP 64068, Liberty, Missouri, might question whether the Fair Market Rent (FMR) of $1,170 for 2024 will sufficiently cover the mortgage on a home priced at $326,529. To address this concern, consider that the FMR reflects the average rent for a two-bedroom apartment in the area. A mortgage payment, however, depends on the interest rate and loan terms. Assuming a typical 30-year fixed-rate mortgage with an interest rate of around 4%, the monthly mortgage payment on a $326,529 home would be approximately $1,570. This means the FMR does not fully cover the mortgage payment, leaving a gap of roughly $400 per month.
The investor may also doubt if there's sufficient rental demand in the area, given that only 25.7% of households are renters. While this percentage indicates a moderate level of rental activity, it's important to note that rental demand is influenced by factors such as employment rates, population growth, and housing affordability. In ZIP 64068, the rental demand is stable, but not exceptionally high. For context, the national average of renter-occupied households is around 36%. Therefore, while rental demand isn't overwhelming, it is present and likely sustainable for small-scale investors.
A final objection could be whether Section 8 vouchers will keep pace with the market rent of $1,243. The FMR set by HUD for ZIP 64068 is intended to reflect the maximum amount that voucher holders can pay for rent. However, the actual value of vouchers can vary based on local conditions and the number of applicants. In recent years, some areas have seen a lag between FMR adjustments and actual market rent increases. As of now, the FMR of $1,170 is below the market rent of $1,243, indicating that landlords might need to subsidize the difference or face challenges in finding tenants who qualify for the program. It's crucial to monitor local HUD adjustments closely to ensure that voucher values align with market rents.
In conclusion, while ZIP 64068 presents some challenges for landlords and small-portfolio investors, it remains a viable market with steady rental demand and reasonable expectations for covering mortgage payments through rental income. The key to success lies in understanding the local rental dynamics and being prepared to adapt to changes in both market rents and voucher policies.
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.