Section 8 Fair Market Rent (FMR) for ZIP 75189 - 2027

Investment Score for ZIP 75189

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	$1,970
1 Bedroom	$2,030
2 Bedrooms	$2,390
3 Bedrooms	$3,010
4 Bedrooms	$3,830
5 Bedrooms	$4,443
6 Bedrooms	$4,976
7 Bedrooms	$5,374
8 Bedrooms	$5,643

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	$2,390	$218,207	1.1%	B
3BR	$3,010	$295,387	1.02%	B
4BR	$3,830	$329,410	1.16%	B
5BR	$4,443	$394,358	1.13%	B

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 75189 (Royse City, TX) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for Royse City, TX, as of 2026 is set at $2470 for a two-bedroom unit. This amount represents 25.3% of the median household income in the area, which stands at $117,125. To understand how these figures compare to actual rents, we can look at the Zillow median price for a two-bedroom home, which is $218,554. The price-to-FMR ratio for this ZIP code is 7.4x, indicating that the median home price is significantly higher than the rent for a similar-sized unit. This high ratio suggests that rental units are relatively affordable compared to the cost of homeownership. However, it also implies that there could be significant constraints for voucher holders. For instance, a voucher holder would need to find a landlord willing to accept a rent of $2470, which is below the average market rate. Given the high median home price, landlords might prefer higher-paying tenants who can afford market rates. #### Affordability & Renter Profile Royse City has a population of 48,739, with only 11.5% of residents being renters. This low percentage indicates that the majority of the population owns their homes, suggesting a tight rental market. The occupancy rate of 94.3% further supports this notion, as it shows that most available housing units are already occupied. Given the median household income of $117,125, the typical resident in Royse City is likely to be well above the poverty line and able to afford market-rate housing. The low renter percentage and high occupancy rate suggest that the rental market is undersupplied relative to demand, making it challenging for voucher holders to find suitable housing. #### Investor Angle From an investor perspective, the ZIP code 75189 offers a potentially lucrative opportunity due to the tight rental market. However, the cash flow potential for properties rented at the FMR level must be carefully considered. At the FMR for a two-bedroom unit ($2470), the rent is significantly lower than the median home price ($218,554). This means that properties rented at FMR levels will generate less revenue compared to those sold at market rates. However, the high occupancy rate and limited supply of rental units indicate strong demand, which could support higher rental prices over time. The investment grade for this ZIP code would be considered moderate to high, given the strong economic indicators and the potential for rental growth. However, investors should be aware that the low renter percentage and high median home price might make it difficult to attract long-term tenants who are not voucher holders. #### Specific Actionable Insights 1. **Target Landlords**: Focus on engaging with landlords who have a history of accepting Section 8 vouchers. Given the high median home price and the tight rental market, finding landlords willing to work with voucher holders is crucial. Investors should consider offering incentives to landlords to encourage them to accept vouchers. 2. **Focus on Smaller Units**: Since the FMR for smaller units (one-bedroom and zero-bedroom) is lower, targeting these units could provide better cash flow opportunities. For example, a one-bedroom unit has an FMR of $2110, which is still below the median home price but may be more attractive to landlords. 3. **Consider Long-Term Rental Growth**: Despite the current challenges, the strong economic indicators and high occupancy rate suggest that rental prices could increase over time. Investors should consider the potential for future rental growth when evaluating the long-term viability of their investments. #### Bottom Line For Section 8-focused investors, Royse City, TX (ZIP 75189) presents a mixed picture. While the tight rental market and high occupancy rate offer strong demand, the low renter percentage and high price-to-FMR ratio indicate significant challenges in finding suitable tenants. The recommendation would be to **Hold** unless investors can secure properties with a track record of accepting vouchers or focus on smaller units where the FMR is lower. In summary, Royse City is a challenging market for Section 8 voucher holders due to the high median home price and limited rental supply. Investors should proceed cautiously and target specific segments of the market to maximize their chances of success.

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.