Location: Van Zandt County, TX | Metro: Dallas, TX HUD Metro FMR Area
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 | $850 |
| 1 Bedroom | $880 |
| 2 Bedrooms | $1,070 |
| 3 Bedrooms | $1,360 |
| 4 Bedrooms | $1,610 |
| 5 Bedrooms | $1,868 |
| 6 Bedrooms | $2,092 |
| 7 Bedrooms | $2,259 |
| 8 Bedrooms | $2,372 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,360 | $250,775 | 0.54% | F |
| 4BR | $1,610 | $291,594 | 0.55% | F |
U.S. Census Bureau data (2024)
The analysis of the Section 8 program in ZIP code 75147 reveals a significant gap between the Fair Market Rent (FMR) and the market rent, known as the Zillow Observed Rent Index (ZORI). For fiscal year 2024, the FMR stands at $1170, while the ZORI is $1799. This discrepancy translates into a difference of $629 per month, or approximately 35%, highlighting the financial implications for landlords and small-portfolio investors.
Given that the FMR is lower than the market rent, landlords who accept Section 8 vouchers will be renting their properties below the open-market rate. The cost of housing voucher tenants can be seen in the reduced rental income compared to what could be earned by renting to market-rate tenants. However, the stability and reliability of Section 8 payments can offset some of these costs, providing a steady stream of income even if it's not at the peak market rate.
In the broader context of ZIP 75147, where 36.9% of residents are renters, the median home value is $275,015, and the median income is $56,940, the decision to participate in the Section 8 program should be carefully weighed. Accepting voucher tenants can help fill vacancies in a market where nearly 4 out of every 10 individuals are renters. Additionally, the lower median income suggests that many residents may rely on assistance programs like Section 8 to afford housing.
While the gap between FMR and ZORI presents a challenge, it also offers an opportunity. Landlords can leverage the consistent demand for affordable housing and the government-backed payment system to ensure occupancy and mitigate risks associated with defaulting tenants. This makes the ZIP 75147 area a potentially attractive market for those looking to generate stable yields rather than maximize monthly rental income.
To summarize, the gap between the FMR of $1170 and the ZORI of $1799 represents a significant reduction in potential rental income for landlords in ZIP 75147. However, the reliability of Section 8 payments and the high proportion of renters in the area can make this a viable strategy for achieving consistent returns. The decision to participate should consider the local economic conditions and the balance between income stability and potential market-rate rents.
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.