Location: Jackson County, AR | Metro: Jackson County, AR
| Unit Size | Monthly FMR |
|---|---|
| Studio | $670 |
| 1 Bedroom | $720 |
| 2 Bedrooms | $940 |
| 3 Bedrooms | $1,210 |
| 4 Bedrooms | $1,240 |
| 5 Bedrooms | $1,438 |
| 6 Bedrooms | $1,611 |
| 7 Bedrooms | $1,740 |
| 8 Bedrooms | $1,827 |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 72473 provides insight into the potential returns for landlords and small-portfolio investors considering participation in the program. To begin, we must consider the Fair Market Rent (FMR) for a two-bedroom unit, which is set at $920 annually for fiscal year 2026, based on metro rates. In contrast, the market rent for a similar unit is reported at $760 annually, according to Census ACS data.
Using the median home value of $92,549 in ZIP 72473, we can calculate the implied gross yield for both the FMR and market rent scenarios. For the FMR scenario, the annual rent of $920 translates to an implied gross yield of approximately 1%. This is calculated by dividing the annual rent by the median home value ($920 / $92,549 = 0.01). On the other hand, using the market rent figure of $760, the implied gross yield drops to about 0.82% ($760 / $92,549 = 0.0082).
Given the 31.1% renter density in ZIP 72473, it's important to recognize that the FMR scenario might be more attainable for landlords. The higher rent amount under the FMR reflects government-set standards designed to ensure housing affordability, which often aligns with higher rental rates compared to the private market. However, the reality of the situation is that landlords should also consider the demand for Section 8 properties. While the data does not provide a Days on Market (DOM) figure for Section 8 units specifically, the general renter density suggests a moderate level of interest in rental properties.
In conclusion, the gross yield under the FMR scenario is significantly higher at 1%, compared to the market rent scenario at 0.82%. This difference highlights the financial benefit of participating in the Section 8 program, assuming a landlord can secure a tenant willing to pay the higher rate. Given the median home value and the relatively high renter density, the FMR scenario presents a more favorable return for investors, although they must weigh this against the potential challenges of finding eligible tenants and managing the administrative requirements of the program.
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.