Location: Wichita, KS | Metro: Wichita, KS HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $730 |
| 1 Bedroom | $770 |
| 2 Bedrooms | $970 |
| 3 Bedrooms | $1,290 |
| 4 Bedrooms | $1,590 |
| 5 Bedrooms | $1,844 |
| 6 Bedrooms | $2,065 |
| 7 Bedrooms | $2,230 |
| 8 Bedrooms | $2,342 |
U.S. Census Bureau data (2024)
The analysis of the Section 8 cap-rate picture for ZIP code 67041 is limited by the lack of complete data, specifically the market rent and median home value. However, we can still provide insights based on the available figures.
The Fair Market Rent (FMR) for a 2-bedroom apartment in ZIP 67041 for fiscal year 2024 is set at $930 per month. To annualize this figure, multiply it by 12 months, resulting in an annual rental income of $11,160. This represents the maximum allowable rent for a Section 8 tenant under this program for a 2-bedroom unit.
Given the median home value is not available, we cannot calculate a precise gross yield for the Section 8 scenario. However, if we assume a typical price-to-rent ratio for single-family homes, we can estimate a range for the gross yield. For instance, if the median home value were around $150,000, the annualized FMR would imply a gross yield of approximately 7.44%. If the median home value were higher, say $200,000, the gross yield would drop to about 5.58%. These estimates are based purely on the FMR and do not account for other factors such as maintenance costs or vacancy rates.
In contrast, the market rent is also not provided, making it impossible to derive a concrete gross yield for the non-Section 8 scenario. Nonetheless, it's important to note that market rents often exceed the FMRs set by the government. Assuming market rents are significantly higher, the gross yield would likely be more favorable for landlords who choose not to participate in the Section 8 program.
The renter density in ZIP 67041 is 4.2%, which suggests that there is a relatively low demand for rental properties compared to owner-occupied homes. This could impact the feasibility of relying solely on Section 8 tenants for rental income. Additionally, the lack of Days on Market (DOM) data makes it difficult to assess how quickly properties might be leased under either scenario.
In conclusion, while the exact gross yields cannot be calculated without the market rent and median home value, the Section 8 scenario implies a gross yield between 5.58% and 7.44% based on estimated home values. The actual gross yield for market rents would likely be higher, making it potentially more attractive for landlords and small-portfolio investors. However, the decision should also consider the administrative requirements and potential risks associated with the Section 8 program.
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.