Location: Banner County, NE | Metro: Banner County, NE
| Unit Size | Monthly FMR |
|---|---|
| Studio | $790 |
| 1 Bedroom | $860 |
| 2 Bedrooms | $1,090 |
| 3 Bedrooms | $1,370 |
| 4 Bedrooms | $1,500 |
| 5 Bedrooms | $1,740 |
| 6 Bedrooms | $1,949 |
| 7 Bedrooms | $2,105 |
| 8 Bedrooms | $2,210 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 69345 reveals some key insights into the potential returns for landlords and small-portfolio investors. To start, let's annualize the figures for a two-bedroom property. The Fair Market Rent (FMR) for a 2BR in ZIP 69345 for FY 2026 is set at $960 per month, while the Census ACS indicates a market rent of $1,125 per month.
Based on the median home value of $430,644, we can calculate the implied gross yield for both scenarios. For the Section 8 FMR of $960, the annualized income would be $11,520. This translates to an implied gross yield of approximately 2.7%, calculated as $11,520 divided by $430,644. On the other hand, using the market rent of $1,125, the annualized income rises to $13,500, resulting in a gross yield of about 3.1%.
The higher gross yield from market rent might seem attractive, but it's important to consider the realities of the local rental market. With a renter density of 36.9%, there is a significant portion of the population that could be interested in renting properties, but the vacancy rate is not specified here. Given the N/A-day DOM (Days on Market), it suggests either very low or very high turnover rates, which could impact the stability of cash flows.
In ZIP 69345, the more realistic scenario is likely to be the Section 8 FMR of $960 per month, due to the government-set limits on rent. While the implied gross yield of 2.7% is lower compared to the market rent scenario, it offers a stable income stream that is guaranteed by the federal government. Landlords should also consider the administrative ease and reduced risk of vacancy associated with Section 8 tenancy.
To summarize, the cap-rate analysis shows that the Section 8 scenario provides a gross yield of 2.7%, while the market rent scenario offers a slightly higher gross yield of 3.1%. However, the actual performance will depend on factors such as vacancy rates and tenant turnover, which are critical for long-term investment planning. For those looking for a predictable and secure rental income, the Section 8 option is the safer bet.
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.