Location: Lincoln, NE | Metro: Lincoln, NE 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 | $1,000 |
| 1 Bedroom | $1,070 |
| 2 Bedrooms | $1,300 |
| 3 Bedrooms | $1,800 |
| 4 Bedrooms | $2,020 |
| 5 Bedrooms | $2,343 |
| 6 Bedrooms | $2,624 |
| 7 Bedrooms | $2,834 |
| 8 Bedrooms | $2,976 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 1BR | $1,070 | $109,131 | 0.98% | C |
| 2BR | $1,300 | $226,586 | 0.57% | F |
| 3BR | $1,800 | $265,797 | 0.68% | D |
| 4BR | $2,020 | $329,024 | 0.61% | D |
U.S. Census Bureau data (2024)
The Section 8 analysis for ZIP code 68505 in Lincoln, Nebraska, reveals a significant gap between the Fair Market Rent (FMR) and the actual market rent. For fiscal year 2024, the FMR is set at $1,150, while the market rent, as measured by the Zillow Rent Index (ZORI), stands at $1,405. This means that landlords can charge $255 more per month above the FMR, representing a 22.2% premium over the subsidized rate.
The disparity between these figures indicates that voucher tenants receive rental assistance that covers only a portion of the market rate. Consequently, landlords who accept Section 8 vouchers will be renting their properties at a rate lower than what they could potentially earn in the open market. This situation creates an additional consideration for landlords, as they must weigh the benefits of guaranteed rental payments against the lower-than-market rental income.
In Lincoln, where 44.1% of residents are renters, the median home value is $263,510, and the median household income is $75,980, the decision to participate in the Section 8 program requires a careful assessment of costs and benefits. Accepting voucher tenants at the FMR of $1,150 means landlords are foregoing $255 per month compared to market rents. This difference can impact overall investment yields, especially when considering the typical maintenance and management costs associated with rental properties.
To put this into perspective, let's consider the financial implications. A landlord with a property rented at the FMR would receive $13,800 annually, whereas renting it at the market rate would bring in $16,860. The annual shortfall for accepting a Section 8 tenant is thus $3,060. This figure must be balanced against the stability provided by government-backed rental payments, which can be particularly valuable in a market where 44.1% of residents are already renters.
Given the context of Lincoln's real estate market, landlords should carefully evaluate whether the lower rent from Section 8 tenants aligns with their investment goals. While the program offers security and a steady stream of income, the trade-off is a reduction in potential earnings, which may not be suitable for all landlords or small-portfolio investors looking to maximize their returns.
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.