Location: Fort Smith, AR | Metro: Fort Smith, AR-OK MSA
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 | $1,010 |
| 1 Bedroom | $1,020 |
| 2 Bedrooms | $1,330 |
| 3 Bedrooms | $1,800 |
| 4 Bedrooms | $2,210 |
| 5 Bedrooms | $2,564 |
| 6 Bedrooms | $2,872 |
| 7 Bedrooms | $3,102 |
| 8 Bedrooms | $3,257 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,800 | $291,412 | 0.62% | D |
U.S. Census Bureau data (2024)
To determine if you should buy in ZIP code 72916 for Section 8 investments, follow these decision points:
1) Does FMR $1020 (ZIP FY 2024) clear debt service on a $321,261 property?
No. The Fair Market Rent (FMR) of $1020 per month does not cover the debt service on a property valued at $321,261. Assuming an average mortgage rate of around 5%, the monthly payment on a $321,261 property would be approximately $1,650, which exceeds the FMR. This makes it financially unfeasible to rely solely on Section 8 income to meet your mortgage obligations.
2) Is market rent $1,507 (ZORI) above, at, or below FMR?
The Zillow Rent Index (ZORI) indicates that the market rent in ZIP 72916 is $1,507 per month, which is above the FMR of $1020. This suggests that landlords can potentially earn higher rents from non-Section 8 tenants. However, this also means that the gap between market rent and Section 8 rent is significant, reducing the attractiveness of the program for landlords in this area.
3) Are 28.7% renters + N/A-day DOM enough demand?
It depends. With 28.7% of residents being renters, there is a moderate level of rental demand in the area. However, the lack of data on days on market (DOM) makes it difficult to assess how quickly rental units are typically filled. If the DOM is short, indicating high demand, then the 28.7% figure could be sufficient. Conversely, if DOM is long, suggesting low demand, then this percentage might not be enough to ensure consistent occupancy.
Decision:
In summary, ZIP 72916 presents challenges for Section 8 landlords due to the mismatch between FMR and debt service requirements, as well as the unknown demand dynamics. Consider alternative investment strategies or locations where FMR more closely aligns with debt service costs and where rental demand is robust and well-documented.
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.