Section 8 Fair Market Rent (FMR) for ZIP 76549 - 2027

Investment Score for ZIP 76549

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	$1,010
1 Bedroom	$1,020
2 Bedrooms	$1,250
3 Bedrooms	$1,730
4 Bedrooms	$2,090
5 Bedrooms	$2,424
6 Bedrooms	$2,715
7 Bedrooms	$2,932
8 Bedrooms	$3,079

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-08-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,250	$159,856	0.78%	D
3BR	$1,730	$207,475	0.83%	C
4BR	$2,090	$241,024	0.87%	C
5BR	$2,424	$301,101	0.81%	C

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 76549 (Killeen, TX) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) figures for ZIP code 76549 in Killeen, TX, indicate that a 2-bedroom unit is set at $1350 per month for the year 2026. However, the actual rent market in this area suggests a much higher price point. According to Zillow, the median price for a 2-bedroom rental property is $151,715, which translates to a monthly rental cost of approximately $1264.38 based on a typical mortgage payment formula. This figure is below the FMR but still represents a significant challenge for voucher holders, who are limited by the FMR cap. The disparity between the FMR and actual market rents means that voucher holders might struggle to find units within their budget, especially since the occupancy rate is high at 92.2%, indicating a competitive market. #### Affordability & Renter Profile In ZIP 76549, 44.7% of the population are renters, which suggests a substantial demand for rental properties. The median household income is $70,871, and the FMR for a 2-bedroom unit ($1350) represents 22.9% of this income. This percentage indicates that renting a 2-bedroom unit is relatively affordable for the average household, but it also highlights the financial strain faced by lower-income families who rely on Section 8 vouchers. Given the high occupancy rate and the significant portion of the population that rents, the market appears to be tight, with limited availability of units that fall within the FMR range. #### Investor Angle From an investor perspective, the ZIP code 76549 presents both opportunities and challenges. The price-to-FMR ratio of 9.4x suggests that the purchase price of rental properties is significantly higher than what can be rented out under the FMR guidelines. For instance, a 2-bedroom unit priced at $151,715 would need to generate a monthly rent of about $1264.38 to break even, assuming a typical mortgage payment formula. However, the FMR cap restricts the maximum allowable rent to $1350, which is only slightly above the break-even point. This narrow margin makes it challenging for investors to achieve positive cash flow without relying on appreciation or other sources of income. The investment grade for this ZIP code would likely be considered moderate to low due to the high purchase prices relative to the FMR. While there is a strong demand for rental properties, the limited ability to charge market rates could impact profitability. Additionally, the high occupancy rate indicates that there is little room for error in terms of vacancy rates, which could further affect cash flow. #### Specific Actionable Insights 1. **Focus on Smaller Units**: Given the high price-to-FMR ratio, investors should consider focusing on smaller units such as 0BR and 1BR apartments, where the FMR is set at $1080. These units have a better chance of being rented out at a profit, considering the lower purchase costs compared to larger units. 2. **Consider Location-Specific Strategies**: Since the overall market is tight, investors should look into areas within ZIP 76549 that have slightly lower occupancy rates or are less desirable but still within the FMR range. This could help in securing tenants more easily and maintaining a steady cash flow. 3. **Utilize Cost Savings**: To improve profitability, investors should explore ways to reduce operating costs through efficient management practices, bulk purchasing of supplies, and leveraging economies of scale if managing multiple properties. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP code 76549 would be to **Hold** or **Skip**. The high price-to-FMR ratio and tight market conditions make it difficult to achieve positive cash flow. Investors looking to enter this market should carefully evaluate their strategies and consider focusing on smaller units or exploring adjacent areas with similar characteristics but potentially more favorable economics. Overall, while there is demand, the current dynamics do not favor new investments unless existing properties can be acquired at a discount or managed with exceptional efficiency.

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.