Location: Wise County, TX | Metro: Fort Worth-Arlington, 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 | $1,320 |
| 1 Bedroom | $1,340 |
| 2 Bedrooms | $1,580 |
| 3 Bedrooms | $2,070 |
| 4 Bedrooms | $2,590 |
| 5 Bedrooms | $3,004 |
| 6 Bedrooms | $3,364 |
| 7 Bedrooms | $3,633 |
| 8 Bedrooms | $3,815 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,580 | $207,778 | 0.76% | D |
| 3BR | $2,070 | $296,331 | 0.7% | D |
| 4BR | $2,590 | $411,998 | 0.63% | D |
| 5BR | $3,004 | $575,247 | 0.52% | F |
U.S. Census Bureau data (2024)
The Section 8 cap-rate analysis for ZIP code 76020 in Azle, TX, reveals some key insights into potential investment opportunities. To begin, let's look at the annualized figures for a two-bedroom unit under both the Fair Market Rent (FMR) and the market rent scenarios.
The FMR for a two-bedroom unit in ZIP 76020 for fiscal year 2024 is set at $1350 per month. This translates to an annual rental income of $16,200. Given the median home value of $329,534, the implied gross yield for the FMR scenario is approximately 4.92%. This is calculated by dividing the annual rental income by the property value: $16,200 / $329,534 = 0.0492 or 4.92%.
On the other hand, the Zillow Observed Rent Index (ZORI) indicates that the market rent for a two-bedroom unit in the same area is $1,736 per month. Annualizing this figure gives us an annual rental income of $20,832. Using the same median home value of $329,534, the implied gross yield for the market rent scenario is about 6.32%. This is derived from $20,832 / $329,534 = 0.0632 or 6.32%.
Considering the 22.3% renter density and the average Days on Market (DOM) of 68 days, it becomes evident that the market rent scenario offers a more realistic projection for investors. The higher renter density suggests a robust demand for rental properties, while the relatively short DOM indicates that properties are typically occupied quickly, reducing the risk of vacancy and lost income.
However, the FMR scenario should not be dismissed entirely. It represents the government-set maximum rental amount for Section 8 participants, which can provide a stable, albeit lower, income stream. For landlords and small-portfolio investors looking to balance between stability and profitability, the market rent scenario presents a more attractive gross yield. Nonetheless, the choice ultimately depends on the investor's goals and risk tolerance.
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.