Location: Harrison County, MO | Metro: Daviess County, MO
| Unit Size | Monthly FMR |
|---|---|
| Studio | $730 |
| 1 Bedroom | $750 |
| 2 Bedrooms | $990 |
| 3 Bedrooms | $1,280 |
| 4 Bedrooms | $1,330 |
| 5 Bedrooms | $1,543 |
| 6 Bedrooms | $1,728 |
| 7 Bedrooms | $1,866 |
| 8 Bedrooms | $1,959 |
U.S. Census Bureau data (2024)
A decision tree for whether a landlord should buy in ZIP code 64642 for Section 8 purposes involves several key considerations based on the provided data.
1. Debt Service Coverage Ratio (DSCR): First, determine if the Fair Market Rent (FMR) of $900 can cover the debt service on a property priced at $118,341. To calculate this, you need to know the annual debt service amount, which includes mortgage payments, property taxes, insurance, and maintenance costs. If the total annual debt service is less than $10,800 ($900 x 12 months), then the FMR would theoretically clear the debt service. However, if the annual debt service exceeds $10,800, then the answer is no, the FMR does not cover the debt service.
2. Market Rent vs. FMR: Next, compare the market rent of $774 to the FMR of $900. Since the market rent is below the FMR, landlords who participate in the Section 8 program can expect to receive a higher rental income than what the market currently offers. This makes the area attractive for Section 8 investments as the difference between the two rates can be significant.
3. Demand Analysis: Finally, assess the demand for rentals in the area. With 18.0% of residents being renters and an unspecified number of days on the market (DOM), the demand analysis requires further clarification. If the DOM is low, indicating quick turnover, this suggests strong demand. However, without a specific DOM figure, the analysis is incomplete. Assuming the DOM is favorable, the high percentage of renters supports the idea that there is sufficient demand for rental properties.
Decision branches:
Note: The annual debt service calculation is crucial for determining the viability of a Section 8 investment. Additionally, the exact number of days on the market (DOM) is necessary to accurately gauge the demand for rental properties in ZIP 64642.
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.