Location: Lawrence County, AR | Metro: Lawrence County, AR
| Unit Size | Monthly FMR |
|---|---|
| Studio | $770 |
| 1 Bedroom | $830 |
| 2 Bedrooms | $1,090 |
| 3 Bedrooms | $1,410 |
| 4 Bedrooms | $1,820 |
| 5 Bedrooms | $2,111 |
| 6 Bedrooms | $2,364 |
| 7 Bedrooms | $2,553 |
| 8 Bedrooms | $2,681 |
U.S. Census Bureau data (2024)
The analysis for ZIP code 72440 focuses on the implications of the Federal Market Rent (FMR) and market rent on the potential gross yield for Section 8 properties. For a two-bedroom apartment, the annualized FMR for fiscal year 2026 is set at $1,000 per month, while the Census ACS indicates a market rent of $691 per month.
The median home value in ZIP 72440 is currently not available, which complicates a direct cap-rate calculation. However, we can still derive a rough picture of the gross yields based on the rental income scenarios provided.
Using the FMR scenario, the annual rental income would be $12,000 ($1,000 x 12 months). In contrast, the market rent scenario would yield an annual income of $8,292 ($691 x 12 months).
The 21.3% renter density suggests a moderate demand for rental properties, but without the Days on Market (DOM) data, it's challenging to assess the speed at which properties can be rented out. This uncertainty affects the reliability of the gross yield estimates.
Considering the data at hand, the FMR gross yield of 8% appears more optimistic. However, it's important to note that this figure is contingent upon the property securing Section 8 tenants and maintaining full occupancy throughout the year. The market rent gross yield of 5.53%, while lower, represents a more conservative estimate based on typical rental rates in the area.
In conclusion, the FMR scenario offers a higher gross yield, but the actual performance will depend on the ability to secure and retain Section 8 tenants. The market rent scenario provides a more grounded expectation, aligned with current rental trends in ZIP 72440.
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.