Location: Perkins County, NE | Metro: Keith 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 | $790 |
| 1 Bedroom | $860 |
| 2 Bedrooms | $1,090 |
| 3 Bedrooms | $1,320 |
| 4 Bedrooms | $1,500 |
| 5 Bedrooms | $1,740 |
| 6 Bedrooms | $1,949 |
| 7 Bedrooms | $2,105 |
| 8 Bedrooms | $2,210 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,320 | $366,156 | 0.36% | F |
U.S. Census Bureau data (2024)
The Section 8 cap rate analysis for ZIP code 69127 provides a clear picture of potential rental yields under government-subsidized versus market conditions. To start, the annualized Fair Market Rent (FMR) for a two-bedroom apartment in this area for fiscal year 2026 is set at $960 per month, which translates to an annual income of $11,520. When compared to the median home value of $294,881, this implies a gross yield of approximately 3.91%. The calculation is straightforward: divide the annual rental income ($11,520) by the median home value ($294,881).
In contrast, the market rent for a similar two-bedroom unit stands at $886 per month, according to the Census ACS data. This equates to an annual market rent of $10,632, leading to a gross yield of about 3.61%. Again, this figure is derived by dividing the annual market rent ($10,632) by the median home value ($294,881).
The difference between these yields is modest, with the Section 8 scenario offering a slightly higher return. However, the reality of which scenario is more practical hinges on several factors, including the local rental market dynamics and the demand for subsidized housing.
ZIP code 69127 has a renter density of 28.9%, indicating that nearly a third of the population rents their homes. While this suggests a reasonable demand for rental properties, it does not necessarily translate to a high demand for Section 8 units. The lack of data on days-on-market (DOM) for rentals in this area further complicates the assessment, as it would provide insight into how quickly units are rented and the competition faced by landlords.
Given the data, the market rent scenario appears more realistic. The slightly lower gross yield is offset by the stability and reliability of Section 8 payments, but the higher yield from market rents can be achieved if landlords manage to keep their vacancies low and maintain occupancy rates. The 28.9% renter density supports the viability of both market and subsidized rentals, but without specific DOM data, we cannot conclusively state which type of rental is more likely to sustain a higher occupancy rate and thus a better gross yield.
In summary, while the Section 8 scenario offers a gross yield of 3.91%, the market rent scenario provides a slightly lower gross yield of 3.61%. For small-portfolio investors and landlords, the choice between these options should consider not only the yield but also the ease of maintaining occupancy and the overall health of the local rental market.
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.