Location: St. Joseph, MO | Metro: St. Joseph, MO-KS MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $740 |
| 1 Bedroom | $750 |
| 2 Bedrooms | $970 |
| 3 Bedrooms | $1,230 |
| 4 Bedrooms | $1,420 |
| 5 Bedrooms | $1,647 |
| 6 Bedrooms | $1,845 |
| 7 Bedrooms | $1,993 |
| 8 Bedrooms | $2,093 |
U.S. Census Bureau data (2024)
A skeptical investor looking into ZIP code 64449 might raise several concerns regarding the feasibility of investing in rental properties here. Let's address these points directly.
Objection 1: Will the Fair Market Rent (FMR) of $880 for ZIP 64449 in fiscal year 2024 cover the mortgage on a $229,460 home?
To determine if the FMR will sufficiently cover the mortgage, we must consider the typical mortgage rates and terms. Assuming a 30-year fixed-rate mortgage at an average rate of 4.5%, the monthly mortgage payment on a $229,460 home would be approximately $1,125. This amount does not include property taxes, insurance, and maintenance costs. Given that the FMR is $880, it falls short of covering the mortgage payment alone, let alone additional expenses. Therefore, the FMR of $880 is insufficient to cover the mortgage on a $229,460 home under these conditions.
Objection 2: Is there enough renter demand at 12.0%?
The 12.0% figure likely represents the percentage of households that rent in ZIP 64449. While this percentage indicates a significant portion of renters, it does not provide a complete picture of the demand. To fully assess demand, we need to look at vacancy rates and the number of available rental units compared to the number of renters. The data provided does not give us these specifics. However, a 12.0% rental rate suggests that there is a stable base of renters, which could support a modest investment strategy. For a more definitive analysis, detailed market research on local rental trends would be necessary.
Objection 3: Will vouchers keep pace with market rents of $783?
The Housing Choice Voucher program aims to help low-income families afford decent housing. Whether vouchers will keep up with market rents depends on the annual adjustments made by the program. The voucher amount for ZIP 64449 is not explicitly stated in the provided data. Typically, voucher amounts are adjusted based on the FMR, which in this case is $880. If the voucher amount is close to or exceeds the FMR, it should reasonably cover the $783 market rent. However, without specific figures on the voucher amounts, we cannot definitively state that they will keep pace with the market rents.
In conclusion, while ZIP 64449 presents some challenges for investors, such as the FMR being lower than the required mortgage payment, it also offers a stable rental market. For a comprehensive decision, further investigation into local rental dynamics and voucher policies is recommended.
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.