Location: New Orleans-Metairie, LA | Metro: New Orleans-Metairie, LA HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $1,090 |
| 1 Bedroom | $1,220 |
| 2 Bedrooms | $1,470 |
| 3 Bedrooms | $1,890 |
| 4 Bedrooms | $2,220 |
| 5 Bedrooms | $2,575 |
| 6 Bedrooms | $2,884 |
| 7 Bedrooms | $3,115 |
| 8 Bedrooms | $3,271 |
U.S. Census Bureau data (2024)
The Section 8 thesis for ZIP code 70039 in Boutte, LA, is anchored by the discrepancy between the Fair Market Rent (FMR) and the actual market rent. The FMR for ZIP 70039 in fiscal year 2024 is set at $1400. However, the current market rent is not available, which suggests that the FMR might be lower than the open-market rates.
This gap can have significant implications for landlords and small-portfolio investors. With an FMR of $1400, the cost of housing voucher tenants is below the open-market rates, potentially leading to reduced rental income. In ZIP 70039, 28.5% of residents are renters, indicating a substantial portion of the population that might rely on housing vouchers. The median home value in the area is $205,626, while the median income stands at $67,727.
The disparity between the FMR and the likely higher market rent means that landlords could face a shortfall if they exclusively cater to voucher tenants. This shortfall would be the difference between the FMR and the market rent, which could be substantial given the limited availability of market rent data. For instance, if the market rent were $1600, the shortfall per unit would be $200, representing a 14.3% reduction in potential rental revenue.
To mitigate this risk, landlords should consider diversifying their tenant base, including both voucher recipients and those paying market rates. This approach can balance the financial impact and ensure a steady cash flow. Additionally, understanding the local demographics and economic conditions can help inform investment decisions and manage expectations regarding yields and occupancy costs.
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.