Location: Little Rock-North Little Rock-Conway, AR | Metro: Little Rock-North Little Rock-Conway, AR HUD Metro FMR Area
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 | $890 |
| 1 Bedroom | $900 |
| 2 Bedrooms | $1,040 |
| 3 Bedrooms | $1,390 |
| 4 Bedrooms | $1,640 |
| 5 Bedrooms | $1,902 |
| 6 Bedrooms | $2,130 |
| 7 Bedrooms | $2,300 |
| 8 Bedrooms | $2,415 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,390 | $207,125 | 0.67% | D |
U.S. Census Bureau data (2024)
A skeptical investor considering ZIP 72126 might have several concerns regarding the feasibility of investing in properties under the Section 8 program. Let's address these concerns head-on with the available data.
Objection 1: Will the Fair Market Rent (FMR) of $830 for ZIP 72126 in fiscal year 2024 cover the mortgage on a home valued at $167,397?
The FMR of $830 must be compared against the potential mortgage costs to determine if it's sufficient. Based on current interest rates, a mortgage on a home priced at $167,397 could range widely depending on down payment and terms. However, with an FMR set at $830, it suggests that the rental income will align closely with the cost of living in the area. It's crucial for investors to ensure their mortgage payments do not exceed this figure significantly, as doing so would likely result in financial strain. Investors should also factor in property taxes and maintenance costs, which can vary but are essential considerations.
Objection 2: Is there enough renter demand at 24.3%?
The 24.3% renter-occupied rate indicates that nearly a quarter of the housing units in ZIP 72126 are rented. While this percentage might seem low, it reflects the reality of the local housing market. The demand for rentals is a critical factor, and the actual number of renters in the area would provide a clearer picture. Additionally, the presence of Section 8 participants can bolster demand, as they seek affordable housing options. Landlords should focus on understanding the specific needs of Section 8 tenants and how their properties meet those needs to capitalize on this segment of the market.
Objection 3: Will vouchers keep pace with $631 market rents?
The market rent of $631 is lower than the FMR of $830, indicating that the voucher amount is designed to cover a significant portion of typical rental costs in ZIP 72126. However, whether vouchers will continue to match market rents depends on future adjustments made by the Department of Housing and Urban Development (HUD). Historically, HUD has adjusted voucher amounts to reflect changes in the cost of living and rental markets. Investors should monitor these adjustments and understand that while vouchers may not always perfectly match market rents, they are intended to remain a viable option for affordable housing.
In summary, while the data provides some clarity on the concerns raised by investors, it's important to note that certain factors such as individual mortgage terms and future HUD adjustments are beyond the scope of the given figures. Investors should use this information as a starting point for further research and due diligence tailored to their specific investment scenarios.
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.