Section 8 Fair Market Rent (FMR) for ZIP 75104 - 2027

Investment Score for ZIP 75104

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	$1,780
1 Bedroom	$1,840
2 Bedrooms	$2,160
3 Bedrooms	$2,720
4 Bedrooms	$3,460
5 Bedrooms	$4,014
6 Bedrooms	$4,496
7 Bedrooms	$4,856
8 Bedrooms	$5,099

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$2,160	$200,392	1.08%	B
3BR	$2,720	$280,653	0.97%	C
4BR	$3,460	$357,569	0.97%	C
5BR	$4,014	$499,547	0.8%	C

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 75104 (Cedar Hill, TX) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) figures for ZIP code 75104, as set by HUD for 2026, provide a benchmark for rental costs that Section 8 voucher holders can afford. For a two-bedroom unit, the FMR is $2,330, which represents 27.2% of the median household income in Cedar Hill. However, the actual rents in the area significantly exceed these figures. The Zillow median price for a two-bedroom home in this ZIP code is $201,673, which translates to a monthly rent of approximately $1,680 based on typical mortgage payments. This implies that the actual market rents are about 7.2 times higher than the FMR for a two-bedroom unit. Given this substantial difference, voucher holders face significant constraints. They must find landlords willing to accept the lower payment rates offered by the vouchers, which can be challenging in a market where rents are much higher. Additionally, the limited number of units available at or below FMR levels means that voucher holders often have fewer options and may need to settle for less desirable properties. #### Affordability & Renter Profile Cedar Hill has a population of 49,228, with 28.0% of residents being renters. The occupancy rate stands at 95.1%, indicating a robust demand for rental housing. The median household income is relatively high at $102,875, suggesting that the area attracts a diverse mix of residents, including those who might not rely solely on Section 8 vouchers for housing. Despite the high median income, the FMR for a two-bedroom unit is only $2,330, which is a small fraction of the average renter's income. This makes it difficult for low-income households to find affordable housing without assistance. The tight market conditions mean that there is little room for oversupply, and landlords have the leverage to charge higher rents, making it even harder for voucher holders to secure housing. #### Investor Angle From an investor perspective, the ZIP code 75104 presents both opportunities and challenges. The FMR for a two-bedroom unit is $2,330, but the actual market rent is around $1,680, based on the Zillow median price. This suggests that investors could potentially achieve positive cash flow if they manage to acquire properties at or near the Zillow median price and rent them out at the FMR levels. However, the investment grade would depend on several factors, including the cost of acquisition, maintenance expenses, and the ability to attract tenants willing to pay the FMR. Given the high price-to-FMR ratio of 7.2x, it is clear that the market is not aligned with the FMR, and investors would need to carefully consider their strategy to ensure profitability. #### Specific Actionable Insights 1. **Focus on Multi-Bedroom Units**: Since the FMR for larger units (such as three-bedroom and four-bedroom homes) is higher ($2,930 and $3,730 respectively), investors should consider acquiring properties with more bedrooms. These units are likely to be more attractive to families and may offer better cash flow potential due to higher rental rates. 2. **Target Affordable Housing Projects**: Investors interested in Section 8-focused properties should look into affordable housing projects that aim to keep rents close to the FMR. Such projects often receive government subsidies and tax incentives, which can help offset the lower rental income. 3. **Engage with Local Landlords**: Building relationships with local landlords who are already familiar with accepting Section 8 vouchers can be beneficial. This can help investors understand the nuances of the market and identify strategies to make their properties more appealing to voucher holders. #### Bottom Line For investors focusing specifically on Section 8 properties, the ZIP code 75104 presents a mixed picture. While there is a strong demand for rental housing, the high price-to-FMR ratio indicates that the market is not aligned with the rental assistance provided by Section 8 vouchers. Therefore, the recommendation is to **Hold** on existing investments and be cautious about new acquisitions unless they can be secured at a price closer to the FMR levels. Investors should also consider diversifying their portfolio to include a mix of market-rate and affordable housing units to balance risk and reward.

Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-08-31). 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.