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 | $970 |
| 1 Bedroom | $980 |
| 2 Bedrooms | $1,130 |
| 3 Bedrooms | $1,520 |
| 4 Bedrooms | $1,820 |
| 5 Bedrooms | $2,111 |
| 6 Bedrooms | $2,364 |
| 7 Bedrooms | $2,553 |
| 8 Bedrooms | $2,681 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,130 | $81,191 | 1.39% | A |
| 3BR | $1,520 | $141,906 | 1.07% | B |
| 4BR | $1,820 | $194,827 | 0.93% | C |
U.S. Census Bureau data (2024)
ZIP code 72204 is located in a diverse part of Little Rock, Arkansas, characterized by a population of 30,525 residents. Approximately 41.5% of these residents are renters, indicating a significant demand for rental properties in the area. The median household income in ZIP 72204 is $40,882, which reflects a middle-income community. Median home values stand at $120,381, suggesting that homeownership is relatively affordable compared to other parts of the city.
The economic landscape of ZIP 72204 is particularly interesting for investors looking into the rental market. According to the Fair Market Rent (FMR) data for the fiscal year 2024, the FMR is set at $1,130, while the market rent, measured by the Zillow Observed Rent Index (ZORI), stands slightly higher at $1,149. This close alignment between the FMR and the market rent implies that Section 8 vouchers can effectively cover the cost of renting in this area without leaving much gap for landlords to fill.
Given these factors, ZIP 72204 would be a suitable location for both hands-off voucher operators and hands-on value-add buyers. For hands-off operators, the low gap between FMR and market rent means that they can manage properties with minimal effort and still attract tenants who can afford the rent through government assistance. On the other hand, hands-on investors looking to add value might find opportunities to improve property conditions and potentially increase rents above the FMR, thereby capturing a higher margin. However, they must ensure that their improvements do not push the rent too far above the FMR, which could disqualify tenants from using their vouchers.
In conclusion, ZIP 72204 offers a balanced environment for real estate investment, especially for those interested in Section 8 properties. With a substantial portion of renters and an income level that aligns well with the rental costs, this area presents a viable option for both passive and active investors.
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.