Location: Washita County, OK | Metro: Washita County, OK
| Unit Size | Monthly FMR |
|---|---|
| Studio | $980 |
| 1 Bedroom | $1,180 |
| 2 Bedrooms | $1,280 |
| 3 Bedrooms | $1,700 |
| 4 Bedrooms | $1,920 |
| 5 Bedrooms | $2,227 |
| 6 Bedrooms | $2,494 |
| 7 Bedrooms | $2,694 |
| 8 Bedrooms | $2,829 |
U.S. Census Bureau data (2024)
The analysis of the Section 8 cap-rate scenario for ZIP code 73661 reveals a challenging investment environment for landlords and small-portfolio investors. Based on the provided figures, the Federal Market Rent (FMR) for a 2-bedroom apartment in ZIP 73661 for fiscal year 2026 is set at $1,220 annually, while the market rent, as per the Census ACS, stands at $1,125 annually.
To calculate the implied gross yield, we must first annualize the rents. For the FMR, the annual rent is $1,220, and for the market rent, it's $1,125. Given the median home value of $128,805, the gross yields can be calculated as follows:
The gross yield using the FMR would be approximately 9.47%. This is derived by dividing the annualized FMR ($1,220) by the median home value ($128,805). In contrast, the gross yield based on the market rent is about 8.73%, calculated by dividing the annualized market rent ($1,125) by the median home value ($128,805).
While the FMR provides a higher gross yield, it is important to consider the actual renter density and days on market (DOM) when determining which scenario is more realistic. The ZIP code 73661 has a renter density of 10.0%, indicating a relatively low demand for rental properties. Additionally, the lack of data on the DOM suggests that there might be challenges in quickly leasing out properties, which could impact the overall profitability.
In light of these factors, the market rent scenario appears more realistic. Despite the slightly lower gross yield of 8.73%, it reflects the true rental dynamics of the area. Landlords should prepare for potentially longer vacancy periods and adjust their expectations accordingly. The higher gross yield of 9.47% based on the FMR might not materialize if properties are not occupied consistently due to the low renter density.
Investors should also factor in other costs such as maintenance, property management, and potential vacancies when making their investment decisions. While the gross yield provides a starting point, the net operating income (NOI) will give a clearer picture of the actual returns.
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.