Location: Fort Smith, AR | Metro: Fort Smith, AR-OK MSA
| Unit Size | Monthly FMR |
|---|---|
| Studio | $820 |
| 1 Bedroom | $830 |
| 2 Bedrooms | $1,080 |
| 3 Bedrooms | $1,460 |
| 4 Bedrooms | $1,790 |
| 5 Bedrooms | $2,076 |
| 6 Bedrooms | $2,325 |
| 7 Bedrooms | $2,511 |
| 8 Bedrooms | $2,637 |
U.S. Census Bureau data (2024)
The analysis for ZIP code 72923 reveals a significant disparity between the Fair Market Rent (FMR) set by HUD at $1210 for fiscal year 2024 and the actual market rent, as measured by Zillow's ZORI, which stands at $1025. This indicates that the FMR is $185 higher than the market rent, representing a 18.1% premium over what the average tenant might pay in the open market.
In this context, where 26.3% of residents are renters, the median home value is $192,985, and the median income is $54,157, the higher FMR can be leveraged to create a yield play for landlords and small-portfolio investors. The $185 difference means that voucher tenants can provide a stable source of income, ensuring that rental properties are filled with tenants who have guaranteed payments through the Housing Choice Voucher program. This stability is particularly beneficial given the relatively high median home value and median income, suggesting that traditional rental markets might fluctuate more due to economic conditions.
However, accepting housing vouchers at rates below the open-market rent comes with its own set of considerations. Landlords must weigh the benefits of guaranteed income against potential drawbacks such as the administrative burden of working with the government program and the possibility of lower maintenance standards, which can sometimes be associated with voucher programs. Additionally, the premium of 18.1% over market rent should be viewed in light of the overall economic landscape of ZIP 72923, where the majority of residents earn an income of $54,157 annually, potentially limiting their ability to afford higher rents even if they are not voucher recipients.
To summarize, the gap between the FMR and market rent in ZIP 72923 presents an opportunity for landlords to secure a consistent income stream through the Section 8 program, despite renting below the open-market rate. This strategy is especially appealing given the local economic indicators, but it requires careful consideration of the additional responsibilities and potential impacts on property management.
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.