Location: Topeka, KS | 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 | $1,210 |
| 1 Bedroom | $1,320 |
| 2 Bedrooms | $1,490 |
| 3 Bedrooms | $1,950 |
| 4 Bedrooms | $2,330 |
| 5 Bedrooms | $2,703 |
| 6 Bedrooms | $3,027 |
| 7 Bedrooms | $3,269 |
| 8 Bedrooms | $3,432 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,490 | $252,341 | 0.59% | F |
| 3BR | $1,950 | $358,068 | 0.54% | F |
| 4BR | $2,330 | $428,853 | 0.54% | F |
| 5BR | $2,703 | $627,081 | 0.43% | F |
U.S. Census Bureau data (2024)
The Section 8 thesis in ZIP code 66086, which encompasses Tonganoxie, KS, highlights a significant gap between the Fair Market Rent (FMR) and the market rent, known as the Zillow Rent Index (ZORI). For fiscal year 2024, the FMR is set at $1230, while the ZORI stands at $1435. This discrepancy amounts to a $205 difference, or approximately 16.6% below the market rate.
When the FMR is lower than the market rent, as it is in Tonganoxie, landlords must understand the implications of accepting housing vouchers that cover rents below the open-market rates. The median home value in the area is $372,246, indicating a mix of homeowners and renters, with 20.4% of residents being renters. The median household income is $98,318, suggesting a moderate economic base that supports both rental and ownership markets.
The cost of housing voucher tenants below open-market rates means landlords will receive less than what they could potentially charge in the open market. However, this also ensures a steady and reliable source of income through government subsidies, which can be particularly beneficial given the local economic conditions. Accepting Section 8 tenants can stabilize occupancy rates and provide a predictable cash flow, especially when compared to the volatility often seen in the private rental market.
In summary, the $205 or 16.6% gap between FMR and market rent in ZIP 66086 presents a challenge for landlords aiming to maximize their yields. Nonetheless, the reliability of Section 8 payments can serve as a strategic advantage, ensuring consistent income even if it's slightly below the market rate. This makes Section 8 properties a viable option for those seeking stable returns in the investment portfolio.
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.