Section 8 Fair Market Rent (FMR) for ZIP 75034 - 2027

Investment Score for ZIP 75034

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,950
1 Bedroom	$2,010
2 Bedrooms	$2,360
3 Bedrooms	$2,970
4 Bedrooms	$3,780
5 Bedrooms	$4,385
6 Bedrooms	$4,911
7 Bedrooms	$5,304
8 Bedrooms	$5,569

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$2,360	$403,232	0.59%	F
3BR	$2,970	$486,986	0.61%	D
4BR	$3,780	$707,519	0.53%	F
5BR	$4,385	$995,208	0.44%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 75034 (Frisco, TX) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) figures for Frisco, TX, in ZIP code 75034, as of 2026, are as follows: - 0BR: $2080 - 1BR: $2170 - 2BR: $2540 (which is 27.4% of the median household income) - 3BR: $3200 - 4BR: $4070 These FMRs represent the maximum amount that a Section 8 voucher holder can pay for rent. However, comparing these figures to actual rental prices reveals significant discrepancies. The Zillow median price for a 2BR property in this area is $409,716, which translates to a monthly mortgage payment of approximately $2,000 based on typical financing terms. This means that even a 2BR unit, which is the most common type of rental unit in the area, would have a price-to-FMR ratio of 13.4x. This high ratio indicates that actual rents are far above the FMR levels set by HUD, making it challenging for voucher holders to find suitable housing within their budget. The constraints for voucher holders in this market are substantial. For instance, a voucher holder with a 2BR unit would be limited to paying $2,540 per month, while the actual rental market price for such units is likely much higher. This disparity could lead to a shortage of available units for voucher holders, potentially forcing them to seek alternative housing options outside the area or accept substandard living conditions. #### Affordability & Renter Profile ZIP code 75034 has a population of 53,818, with 61.4% of residents being renters. The occupancy rate stands at 93.7%, indicating a tight rental market where demand significantly outstrips supply. Given the median household income of $111,122, the majority of residents are likely middle to upper-middle class individuals who can afford higher rents. However, the affordability issue becomes apparent when we consider the FMR for a 2BR unit, which is only $2,540, or 27.4% of the median household income. This suggests that the market is not affordable for low-income households, especially those relying on Section 8 vouchers. The high price-to-FMR ratio further underscores this point, as it implies that the actual rental prices are well beyond what the FMR guidelines suggest. Given the high percentage of renters and the tight occupancy rate, it is clear that this is a highly competitive market. The scarcity of affordable units for voucher holders means that there is little room for flexibility in terms of location, amenities, or quality. Investors looking to cater to this demographic need to be aware of the challenges in finding properties that meet both the FMR requirements and the preferences of potential tenants. #### Investor Angle From an investor’s perspective, the ZIP code 75034 presents a mixed picture. The FMR for a 2BR unit is $2,540, which is significantly lower than the actual rental market price. Based on the Zillow median price of $409,716, the monthly mortgage payment would be around $2,000, leaving a small margin for profit if the property is rented at the FMR level. To determine if this ZIP code is cash-flow positive at FMR, we must consider additional expenses such as property taxes, insurance, maintenance, and management fees. Assuming a conservative estimate of these costs totaling $600 per month, the net cash flow would be: \[ \text{Net Cash Flow} = \text{FMR Rent} - (\text{Mortgage Payment} + \text{Additional Expenses}) \] \[ \text{Net Cash Flow} = \$2,540 - (\$2,000 + \$600) \] \[ \text{Net Cash Flow} = \$2,540 - \$2,600 \] \[ \text{Net Cash Flow} = -\$60 \] This calculation shows that renting a 2BR unit at the FMR level would result in a negative cash flow of $60 per month. Therefore, the investment grade for properties in this ZIP code, specifically targeting Section 8 voucher holders, is relatively low due to the financial constraints imposed by the FMR. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Since the FMR for smaller units (0BR and 1BR) is lower, investing in properties with fewer bedrooms might provide better cash flow opportunities. For example, a 1BR unit with an FMR of $2,170 could potentially cover the mortgage payment and additional expenses if the mortgage is below $1,570 per month. 2. **Consider Location-Specific Strategies**: Given the high percentage of renters and the tight market, investors should focus on areas within ZIP 75034 that offer slightly lower rental rates but still fall within the FMR guidelines. This could involve targeting neighborhoods with older, less expensive properties that are still habitable and meet safety standards. 3. **Utilize Property Management Services**: Due to the high demand and limited supply, property management services can play a crucial role in ensuring that properties are maintained and occupied efficiently. Investing in professional property management can help mitigate some of the financial risks associated with negative cash flow and ensure compliance with Section 8 regulations. #### Bottom Line Based on the provided data, the recommendation for Section 8-focused investors in ZIP code 75034 is to **Skip** this market. The high price-to-FMR ratio and the resulting negative cash flow make it financially unviable to invest in properties targeting this demographic. Additionally, the tight rental market and high competition for units mean that finding suitable properties within the FMR limits will be extremely difficult. Investors should look for markets with more favorable FMR-to-rent ratios and less stringent financial constraints to achieve positive cash flow and successful investments.

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.