Location: Rusk County, TX | Metro: Rusk County, TX HUD Metro FMR Area
| Unit Size | Monthly FMR |
|---|---|
| Studio | $810 |
| 1 Bedroom | $860 |
| 2 Bedrooms | $1,130 |
| 3 Bedrooms | $1,360 |
| 4 Bedrooms | $1,490 |
| 5 Bedrooms | $1,728 |
| 6 Bedrooms | $1,935 |
| 7 Bedrooms | $2,090 |
| 8 Bedrooms | $2,195 |
U.S. Census Bureau data (2024)
A skeptical investor looking at ZIP 75667 might have several concerns regarding the feasibility of investing in properties that participate in the Section 8 program. Here, we address those concerns directly using the available data.
The first objection is whether the Fair Market Rent (FMR) of $1,030 for ZIP 75667 in fiscal year 2024 will be sufficient to cover the mortgage on a home valued at $236,309. To evaluate this, we must consider the typical mortgage rates and terms. Assuming a standard 30-year fixed-rate mortgage with an interest rate around 4%, the monthly payment on a $236,309 home would be approximately $1,125, which exceeds the FMR by $95. This suggests that the FMR alone might not cover the mortgage payments without additional income sources or a lower property value.
The second concern is the level of renter demand in ZIP 75667, given that only 18.1% of the population are renters. While this percentage is relatively low, it does not necessarily indicate a lack of demand. The key metric here is the number of renters relative to the supply of rental units. If the supply of rental units is limited, even a small percentage of the population can drive strong demand. However, the data provided does not specify the total number of rental units or the vacancy rate, making it difficult to conclusively assess the demand situation.
The third objection is whether the Section 8 voucher amounts will keep pace with the market rents, which are currently at $896. The FMR of $1,030 is higher than the current market rent, indicating that voucher holders could potentially afford homes at the FMR. Yet, the actual voucher amount might be lower than the FMR, depending on local housing authority policies. It's crucial for investors to understand the specifics of voucher distribution and any adjustments made by the housing authority to ensure they align with market conditions.
In conclusion, while the FMR of $1,030 in ZIP 75667 for fiscal year 2024 may fall short of covering a typical mortgage payment on a home priced at $236,309, it does offer a competitive edge over market rents of $896. The demand for rentals, however, remains uncertain with the given data, necessitating further research into the local rental market dynamics.
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.