Location: Kearney County, NE | Metro: Franklin County, NE
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 | $770 |
| 1 Bedroom | $880 |
| 2 Bedrooms | $1,090 |
| 3 Bedrooms | $1,360 |
| 4 Bedrooms | $1,490 |
| 5 Bedrooms | $1,728 |
| 6 Bedrooms | $1,935 |
| 7 Bedrooms | $2,090 |
| 8 Bedrooms | $2,195 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,090 | $88,450 | 1.23% | A |
| 3BR | $1,360 | $164,739 | 0.83% | C |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP 68939, Franklin, NE, reveals two distinct scenarios based on the Fair Market Rent (FMR) and market rent figures. Using the annualized 2BR FMR of $1,210 for FY 2026, the implied gross yield can be calculated as follows:
$1,210 multiplied by 12 months equals an annual rental income of $14,520. Dividing this by the median home value of $146,694 yields a gross yield of approximately 9.9%. This calculation assumes that the property would be rented at the FMR rate throughout the year.
In contrast, using the market rent figure of $756, the annual rental income would be $756 multiplied by 12, equating to $9,072 annually. When this amount is divided by the median home value of $146,694, the gross yield drops to about 6.2%.
The significant difference between these two gross yields highlights the impact of rental subsidies on investment returns. However, the more realistic scenario depends on several factors, including the local rental market conditions and the availability of Section 8 vouchers.
Given the 17.8% renter density in Franklin, NE, it suggests that a majority of homeowners do not rely on rental income. The N/A-day DOM (days on market) indicates that there is either insufficient data or that homes are sold quickly, which could imply a strong demand for owner-occupied properties. These factors point towards the market rent scenario being more realistic for most investors.
While the Section 8 program can provide stable long-term tenants, the lower gross yield of 6.2% based on market rent reflects the current reality of the local rental market. Investors should consider these figures when evaluating potential returns and aligning their investment strategies with the actual conditions in ZIP 68939.
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.