Location: Houston-The Woodlands-Sugar Land, TX | Metro: Houston-The Woodlands-Sugar Land, 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 | $960 |
| 1 Bedroom | $990 |
| 2 Bedrooms | $1,170 |
| 3 Bedrooms | $1,580 |
| 4 Bedrooms | $1,960 |
| 5 Bedrooms | $2,274 |
| 6 Bedrooms | $2,547 |
| 7 Bedrooms | $2,751 |
| 8 Bedrooms | $2,889 |
Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)
| Bedrooms | Monthly FMR | Median Price | 1% Rule | Grade |
|---|---|---|---|---|
| 2BR | $1,170 | $213,414 | 0.55% | F |
| 3BR | $1,580 | $272,502 | 0.58% | F |
| 4BR | $1,960 | $328,894 | 0.6% | F |
U.S. Census Bureau data (2024)
To determine if you should buy in ZIP code 77023 (Houston, TX) for Section 8 investment, follow this decision tree:
1) Does the Fair Market Rent (FMR) of $1,110 cover the debt service on a property valued at $248,587?
No. The FMR of $1,110 does not sufficiently cover the debt service on a property priced at $248,587. Debt service typically includes mortgage payments, property taxes, insurance, and maintenance costs. For a property of this value, these expenses would likely exceed the FMR amount.
2) How does the market rent compare to the FMR?
The market rent, represented by the Zillow Rent Index (ZORI), is $1,299. This is above the FMR of $1,110. This indicates that the market rent is higher than what is considered fair market rent for Section 8 purposes, which could mean that landlords might struggle to find tenants willing to pay the higher market rate under the Section 8 program.
3) Is there enough rental demand to support a Section 8 investment?
The rental demand in ZIP 77023 is composed of 51.9% renters. However, the Days on Market (DOM) data is not available, which makes it difficult to assess how quickly properties are rented out. Without this information, it's challenging to determine if there is sufficient demand to support a Section 8 investment.
If the answers to these questions are unfavorable, it suggests that investing in ZIP 77023 for Section 8 purposes may not be financially viable due to the high property costs relative to the FMR and the potential mismatch between market rent and what tenants can afford under the program.
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.