Section 8 Fair Market Rent (FMR) for ZIP 71913 - 2027

Investment Score for ZIP 71913

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$890
1 Bedroom	$890
2 Bedrooms	$1,150
3 Bedrooms	$1,470
4 Bedrooms	$1,660
5 Bedrooms	$1,926
6 Bedrooms	$2,157
7 Bedrooms	$2,330
8 Bedrooms	$2,447

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$890	$166,919	0.53%	F
2BR	$1,150	$211,875	0.54%	F
3BR	$1,470	$273,452	0.54%	F
4BR	$1,660	$455,415	0.36%	F
5BR	$1,926	$761,367	0.25%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 71913 (Hot Springs, AR) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 71913 in Hot Springs, AR, is set at $1130 for a two-bedroom unit in 2026. This figure represents 24.2% of the median household income in the area, which stands at $56,010. To understand how this compares to actual rents, we need to consider the price-to-FMR ratio. The Zillow median price for a two-bedroom property in this ZIP code is $213,523, which translates to a price-to-FMR ratio of 15.7 times. This high ratio suggests that actual rents in the market are significantly higher than the FMR, making it challenging for Section 8 voucher holders to find affordable housing. Given that the FMR is set to ensure that voucher holders can afford to live in the area, the actual rental prices being much higher than the FMR indicate a significant constraint for these individuals. They may struggle to find landlords willing to accept their vouchers due to the lower payment rates compared to market rents. #### Affordability & Renter Profile ZIP code 71913 has a population of 47,477, with 34.3% of residents being renters. This means there are approximately 16,278 renters in the area. The occupancy rate of 81.2% suggests that the rental market is relatively tight, indicating a strong demand for rental properties. However, with the high price-to-FMR ratio, affordability remains a significant issue for many renters, especially those relying on Section 8 vouchers. The median household income of $56,010 implies that the average renter might be facing financial challenges when trying to secure housing. Given that 24.2% of the median income is allocated towards a two-bedroom unit, it leaves little room for other expenses. Therefore, the rental market in 71913 is likely to be competitive, with limited options for low-income families who rely on government assistance. #### Investor Angle From an investor’s perspective, the FMR for a two-bedroom unit is $1130. However, the actual median rental price based on Zillow data is much higher, at $213,523. This indicates that the market is not aligned with the FMR, and investors who aim to operate strictly within FMR guidelines will face challenges in achieving positive cash flow. To determine if operating at FMR levels is feasible, we must consider the typical rental income versus the costs associated with owning and maintaining a property. If an investor purchases a two-bedroom property at the median price of $213,523 and aims to rent it out at $1130 per month, they would need to evaluate the potential cash flow against mortgage payments, property taxes, insurance, maintenance, and other operational costs. Given the high purchase price relative to the FMR, it is unlikely that such an investment would be cash-flow positive without significant subsidies or additional revenue sources. The investment grade for this ZIP code would be considered low due to the mismatch between the FMR and actual market prices. Investors seeking to focus solely on Section 8 voucher tenants would likely find the market challenging unless they can acquire properties at below-market rates or in areas where rental prices are closer to the FMR. #### Specific Actionable Insights 1. **Focus on Below-Median Properties**: Investors should look for properties priced below the median of $213,523. For instance, a two-bedroom unit priced at around $150,000 could potentially generate a positive cash flow when rented at the FMR of $1130. This would require a careful analysis of the total cost of ownership, including mortgage payments, taxes, and maintenance. 2. **Consider Multi-Family Units**: Given the high FMR for larger units (e.g., three-bedroom units at $1440 and four-bedroom units at $1730), multi-family units might offer better opportunities for cash flow. An investor could target properties with multiple units, where the combined rental income from several units rented at FMR levels could offset the higher purchase price. 3. **Engage with Local Housing Authorities**: Building relationships with local housing authorities can provide insights into the availability of Section 8 vouchers and any upcoming changes in policy or funding. This knowledge can help investors make informed decisions about which properties to acquire and how to structure their rental offerings to attract voucher holders. #### Bottom Line Based on the provided data, the recommendation for Section 8-focused investors in ZIP code 71913 is to **Skip** this market. The high price-to-FMR ratio and the tight rental market suggest that it would be difficult to achieve positive cash flow while adhering to FMR guidelines. Additionally, the significant gap between the FMR and actual market prices makes it challenging to find properties that are both affordable and suitable for Section 8 tenants. Investors looking to enter this market should carefully assess the potential for acquiring properties at below-market rates or explore alternative strategies to align their investments with the realities of the rental market in Hot Springs, AR.

Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). 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.