Section 8 Fair Market Rent (FMR) for ZIP 72640 - 2027

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$650
1 Bedroom	$840
2 Bedrooms	$910
3 Bedrooms	$1,080
4 Bedrooms	$1,520
5 Bedrooms	$1,763
6 Bedrooms	$1,975
7 Bedrooms	$2,133
8 Bedrooms	$2,240

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

Based on the data available, the median home value for ZIP code 72640 is approximately $158,800. To provide a clear picture of the Section 8 cap-rate scenario for this area, we need to compare the annualized Fair Market Rent (FMR) for a two-bedroom unit with the potential market rent against the median home value.

The Fair Market Rent (FMR) for a two-bedroom unit in ZIP 72640 is set at $880 per month for fiscal year 2026, based on metropolitan area standards. This translates to an annual rental income of $10,560. Given the median home value of $158,800, the implied gross yield for a property rented under Section 8 would be about 6.65%. This calculation assumes that the property is valued at the median home value and that the entire annual rental income comes from a two-bedroom unit.

However, the market rent for ZIP 72640 is currently not available. If we assume a typical market rent scenario where a two-bedroom unit could potentially rent for higher than the FMR, the gross yield would likely be lower than the Section 8 scenario, as market rents typically exceed the FMR. For example, if the market rent for a two-bedroom unit was $1,200 per month, the annual rental income would be $14,400, leading to a gross yield of about 9.08%.

Given the 9.0% renter density and the lack of specific Days on Market (DOM) data, the Section 8 scenario appears more realistic. The lower renter density suggests that the pool of potential tenants willing to pay market rates may be smaller, making it more likely that properties will be rented at or near the FMR. Additionally, the uncertainty around the market rent due to the lack of specific DOM data further supports the reliance on the Section 8 program for consistent rental income.

In conclusion, the gross yield of 6.65% derived from the Section 8 FMR is a more reliable estimate for ZIP 72640 than the hypothetical market rent scenario. Investors should consider this yield when evaluating the potential returns on investment in this area.

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.