Section 8 Fair Market Rent (FMR) for ZIP 77327 - 2027

Investment Score for ZIP 77327

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	$920
1 Bedroom	$940
2 Bedrooms	$1,120
3 Bedrooms	$1,510
4 Bedrooms	$1,870
5 Bedrooms	$2,169
6 Bedrooms	$2,429
7 Bedrooms	$2,623
8 Bedrooms	$2,754

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
2BR	$1,120	$156,582	0.72%	D
3BR	$1,510	$221,201	0.68%	D
4BR	$1,870	$251,699	0.74%	D

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 77327 (Dayton, TX) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) for ZIP code 77327 is set by HUD for 2026, with the following figures: - 0BR: $940 - 1BR: $980 - 2BR: $1160 (22.4% of median household income) - 3BR: $1560 - 4BR: $1950 These FMRs represent the maximum amount that a Section 8 voucher holder can pay towards rent. However, comparing these figures to actual rents in the area reveals significant discrepancies. The Zillow median price for a 2BR home in Dayton, TX is $159,143, which translates to a monthly mortgage payment of approximately $746 based on a 30-year fixed-rate mortgage at 4.5%. This figure does not include property taxes, insurance, and maintenance costs, which would add to the total cost of ownership. Given the high Price-to-FMR ratio of 11.4x, it is evident that actual rental prices far exceed the FMRs. For instance, a 2BR unit priced at $159,143 would likely have a monthly rental rate significantly higher than $1160. This means that voucher holders face substantial constraints in finding affordable housing within their budget. They may need to look for properties outside the FMR range or in less desirable areas to secure housing. #### Affordability & Renter Profile In ZIP code 77327, the population is 42,685, with 14.4% of households being renters. The occupancy rate stands at 84.8%, indicating a relatively tight market where most available units are occupied. The median household income is $62,219, suggesting that the majority of residents are employed and earning a moderate income. However, the 22.4% of median income required for a 2BR unit under the FMR indicates that even those who qualify for Section 8 vouchers might struggle to find affordable housing. The high Price-to-FMR ratio also suggests that the market is not particularly favorable for low-income renters. With actual rents likely much higher than the FMRs, voucher holders may find themselves competing with other renters who can afford higher rates. This competition could lead to landlords preferring non-voucher tenants who can pay more, thus limiting the availability of affordable options for voucher holders. #### Investor Angle From an investor perspective, the ZIP code 77327 presents both opportunities and challenges. The high Price-to-FMR ratio indicates that the market is not aligned with the FMRs, meaning that rental income from properties rented to voucher holders will be lower than what could be achieved in a market-driven scenario. However, the tight occupancy rate suggests that there is demand for rental units, which could provide steady cash flow if managed effectively. To determine whether this ZIP code is cash-flow positive at FMR, we need to consider the typical expenses associated with owning a rental property. Assuming a 2BR unit priced at $159,143, the monthly mortgage payment would be around $746. Adding property taxes (estimated at 1.5% of the home value), insurance (around $100 per month), and maintenance costs (approximately $50 per month), the total monthly expense would be roughly $1000. At the FMR of $1160, the net cash flow would be $160 per month, which is modest but still positive. However, the investment grade would be lower due to the high Price-to-FMR ratio and the potential difficulty in attracting and retaining voucher holders. Investors should be prepared for lower returns compared to market-rate rentals and should focus on properties that offer good value and are well-maintained to attract voucher holders. #### Specific Actionable Insights 1. **Focus on Properties Below FMR**: Given the high Price-to-FMR ratio, investors should seek out properties that are priced below the FMRs. For example, a 2BR unit priced at $1100 per month would be more attractive to voucher holders and would ensure compliance with HUD regulations. This strategy could help in securing long-term tenants and maintaining steady cash flow. 2. **Consider Multi-Family Units**: Since the 3BR and 4BR FMRs are higher ($1560 and $1950 respectively), multi-family units might be more appealing to voucher holders. These larger units often accommodate families, and the higher FMRs could better cover the mortgage and other expenses associated with such properties. 3. **Enhance Property Value**: To remain competitive in a tight market, investors should consider enhancing the value of their properties through renovations and improvements. This could make the units more attractive to voucher holders and potentially allow for slightly higher rents while still remaining within the FMR guidelines. #### Bottom Line For Section 8-focused investors, the ZIP code 77327 presents a challenging yet feasible market. The high Price-to-FMR ratio and limited supply of affordable units suggest that cash flows will be modest. Therefore, the recommendation is to **Hold** or **Skip** unless investors can identify properties priced below the FMRs or can enhance the value of existing properties to attract voucher holders. The tight market conditions indicate that there is demand for rental units, but the alignment between actual rents and FMRs is poor, making it difficult to achieve high returns.

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.