Location: Leon County, TX | Metro: Freestone County, TX
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 | $830 |
| 1 Bedroom | $830 |
| 2 Bedrooms | $1,060 |
| 3 Bedrooms | $1,400 |
| 4 Bedrooms | $1,420 |
| 5 Bedrooms | $1,647 |
| 6 Bedrooms | $1,845 |
| 7 Bedrooms | $1,993 |
| 8 Bedrooms | $2,093 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 3BR | $1,400 | $302,296 | 0.46% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 75831 reveals an interesting scenario when comparing the federally mandated Fair Market Rent (FMR) to the actual market rent levels. For a two-bedroom unit, the FMR set by the government for fiscal year 2026 is $1,030 per month, while the Census ACS data indicates a market rent of $920 per month.
Using these figures, we can calculate the implied gross yield for both situations. With the FMR of $1,030, the annual rental income would be $12,360. Dividing this by the median home value of $290,074 gives us an implied gross yield of approximately 4.26%. On the other hand, using the market rent of $920, the annual rental income drops to $11,040, resulting in an implied gross yield of about 3.79%.
The higher gross yield based on the FMR suggests a more favorable investment scenario for landlords participating in the Section 8 program. However, the reality of the local housing market must also be considered. The renter density in ZIP 75831 is 28.7%, indicating that a significant portion of the population owns homes rather than renting. This could impact the demand for rental properties and the likelihood of securing tenants at the FMR rate.
Given the N/A-day Days on Market (DOM), it's important to note that this figure typically signifies either very quick sales or a lack of recent transactional data. In either case, it does not provide a clear indication of the rental market dynamics. However, considering the lower market rent of $920 compared to the FMR of $1,030, it is more realistic to expect that landlords might have difficulty achieving the higher FMR rate without substantial incentives or subsidies. Thus, the gross yield of 3.79% based on market rent is likely a more accurate reflection of potential returns for most investors.
In conclusion, while the Section 8 program offers a higher rental rate, the actual market conditions suggest that landlords should anticipate a gross yield closer to the market rent level. This analysis provides a clear picture of the financial landscape for those considering investment in ZIP 75831, allowing them to make informed decisions based on realistic expectations.
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.