Location: Otoe County, NE | Metro: Omaha-Council Bluffs, NE-IA 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 | $1,600 |
| 1 Bedroom | $1,670 |
| 2 Bedrooms | $2,000 |
| 3 Bedrooms | $2,650 |
| 4 Bedrooms | $2,990 |
| 5 Bedrooms | $3,468 |
| 6 Bedrooms | $3,884 |
| 7 Bedrooms | $4,195 |
| 8 Bedrooms | $4,405 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $2,000 | $361,162 | 0.55% | F |
| 3BR | $2,650 | $380,937 | 0.7% | D |
U.S. Census Bureau data (2024)
Skeptical investors considering Union, NE (ZIP 68455) for their next rental property investment might raise several valid concerns. Addressing these points directly with the available data can help clarify the potential risks and rewards.
Objection 1: Will Fair Market Rent (FMR) of $1,030 (for zip FY 2024) cover the mortgage on a $348,427 home?
The FMR of $1,030 is a critical figure when assessing the viability of a rental property. To determine if this will sufficiently cover the mortgage, we must consider the typical mortgage rates and terms. Assuming a standard 30-year fixed-rate mortgage at an interest rate of around 5%, the monthly mortgage payment for a $348,427 home would be approximately $1,900. This means that the FMR of $1,030 alone would not cover the mortgage payments, leaving a significant shortfall. However, it's important to note that the FMR is the maximum amount that HUD will pay for a unit in that area, and actual rents could be higher depending on the condition and amenities of the property.
Objection 2: Is there enough renter demand at 27.6%?
The percentage of renter-occupied housing units in Union, NE stands at 27.6%. While this indicates a smaller pool of potential renters compared to areas with higher percentages, it does not necessarily mean there isn't sufficient demand. The total number of housing units in the area plays a crucial role in determining the absolute number of renters. If the total housing stock is large, 27.6% could still represent a substantial number of renters. Moreover, the demand for rental properties can vary based on factors such as job availability, local economy, and demographic trends. The data provided does not offer insights into these aspects, so further investigation into local economic conditions and tenant preferences would be advisable.
Objection 3: Will vouchers keep pace with $1,653 market rents?
The Fair Market Rent (FMR) of $1,030 is notably lower than the reported market rent of $1,653. This discrepancy suggests that voucher holders may struggle to afford market-rate rentals without additional income or subsidies. The effectiveness of vouchers in covering market rents depends on the specific rules and funding levels of the housing assistance program in question. It's also worth noting that the availability and usage of vouchers can fluctuate over time due to changes in government policy and funding. Therefore, while vouchers might not fully cover the $1,653 market rent, they can still provide a valuable subsidy for low-income tenants, making the property more attractive to those who qualify.
In conclusion, while the data presents some challenges, particularly with the gap between FMR and market rents, and the relatively low percentage of renters, it does not paint a wholly negative picture. Investors should conduct thorough research into local economic conditions and consider the broader context of housing needs and support programs before making a decision.
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.